Thursday, September 23, 1999

SES Promotes Hong Kong Shipping Industry

Hong Kong, as an international trading centre and a focus for Asian shipping, is a natural location for expanding shipping activities, especially those related to Asia trade in general and China trade in particular.

The Secretary for Economic Services, Mr Stephen Ip, said this today (Thursday) when addressing the Ship Registers Conference in London on the recent development of the Hong Kong Shipping Register and the steps being undertaken to promote the shipping industry in Hong Kong.

Mr Ip said, "Continuous efforts are being made by the Hong Kong Special Administrative Region Government not only to reinforce the qualities which have made Hong Kong the most efficient and the busiest container port but also to further sharpen our competitive edge in shipping."

He said a package of measures to make the Hong Kong Shipping Register more competitive and user-friendly was instituted in April this year. These covered reduced cost of registration and simplified procedures for ships flying the Hong Kong flag.

Mr Ip said, "We have introduced new and simple fee structure through the elimination of minor fee items. To help shipowners reduce their operating cost, we have re-aligned our regulatory requirements and technical standards with those of international conventions."

"Owners of Hong Kong ships are not required to pay any tax on profits made overseas. They are also exempted from paying tax on profits made on cargo uplifted from Hong Kong."

"We are now in the process of concluding double taxation relief arrangement with Hong Kong's trading partners to exempt owners of Hong Kong ships from paying any freight tax levied on cargo uplifted from overseas. Agreements have been concluded with USA, Mainland China and New Zealand and similar agreements are under discussion with many other tax administrations," Mr Ip added.

He said, "The Hong Kong Register recognises the need not only to be a competitive flag but also to be recognised as a Quality Register. The detention rate of Hong Kong ships under various port state control regimes is among the lowest in the world."

Mr Ip noted that Hong Kong was the first flag administration in the world to adopt such an elaborate quality management system on Hong Kong ships, which would improve the quality of the Hong Kong fleet without incurring unnecessary expenditure on the part of the shipowners.

On raising Hong Kong's status as a maritime centre, Mr Ip said, "With Hong Kong shipowners controlling some six per cent of world tonnage, over 31 million gross tons and over 1,000 shipping related companies in Hong Kong, we have a solid base to build on."

"In Hong Kong we do recognise the need to continue to improve the business environment for shipping. Our effort to improve services, safety standards and personnel training aims not only to serve the Hong Kong shipping industry, but also to make the world shipping industry more competitive. The Hong Kong Port and Maritime Board was established in June 1998 to undertake this mission."

Mr Ip said, "Asian shipowners now control half of the world tonnage. They are looking for better services by the classification societies, P&I Clubs and maritime lawyers. In particular they would like to have access to these services closer at home."

"With Asia emerging as an important regional shipping centre, we would encourage international maritime services companies, especially those based in London or elsewhere in the West, to seriously consider opening up branch offices in Asia to be close to their clients."

Mr Ip said, "Hong Kong is ideally located to meet this objective, because of the critical mass already here, our strengths in shipping finance and P&I Club, the cluster of local shipowners, and maritime administration based on the UK model, and more so, an extremely business friendly environment and Government, not to mention Hong Kong's position as the gateway to Mainland China, one of the largest maritime countries in the world with considerable potential for expansion."

"Our excellent telecommunications network, finance, insurance and legal services, simple and low tax regime are attracting more and more Mainland and overseas shipping companies to Hong Kong," he said.

Mr Ip is on a promotional trip with members of the Hong Kong Port and Maritime Board to highlight the attractions of the Hong Kong Shipping Register and Hong Kong as an international shipping centre. The delegation has visited three other major port and shipping centres - New York, Amsterdam and Rotterdam - before concluding their trip at London.