Bosses of small companies in Hong Kong have said the government’s budget relief measures including a low interest loan scheme are better than nothing, but still not enough.
Financial Secretary Paul Chan Mo-po announced a HK$120 billion relief deal in his 2020/21 budget speech, including measures aimed at offering help to the businesses hit by the coronavirus epidemic.
Among them were a concessionary low-interest loan scheme, reduction of profit tax, waiving of rates, as well as utility subsidies.
Gloria Chan, courses director of Future Education (HK), a local tutorial centre in Yuen Long, said she was disappointed at the government’s relief measures for small and medium-sized businesses.
She said her educational centre would only receive some HK$10,000, mainly from the waiving of rates for non-domestic properties, and electricity subsidies.
Her centre, which has about 50 primary school students and eight teachers – three full time, five part time – has been closed since the Lunar New Year, despite the absence of clear guidelines from the Education Bureau on the operation of tutorial centres amid the outbreak.
With no income, it had to fork out some HK$50,000 per month to cover costs, she said.
“The relief measures are unfair, especially to small businesses like ours,” she said. “We small businesses have been struggling to avoid closure.”
She said she would consider borrowing with the low-interest loans to sustain the business, which was in need of some HK$300,000. She said she expected to learn more about the scheme before making a decision.
In his speech, Chan said the government would provide a 100 per cent guarantee under the concessionary loan scheme, and the maximum amount of loans for eligible enterprises would be based on their salary and rental expenditures for six months, subject to a ceiling of HK$2 million.
The government would provide guarantees of up to HK$20 billion under the scheme, Chan said.
Gordon Lam Sui-wa, owner of the 616 Beef Hotpot restaurant in Whampoa, said the loan scheme would be the most effective measure for relieving pressure on businesses, but urged the government to implement it as soon as possible.
“Money is what many businesses need the most at the moment,” he said. “But the concern is how long the application process will take, and when businesses will actually receive the loans. Many are facing the pressure of immediate closure.”
Lam said his restaurant had seen business plunge by some 90 per cent since the outbreak of the coronavirus. He said his business could benefit by HK$30,000 to HK$40,000 from the relief measures, accounting for about 20 per cent of its monthly expenses.
“These measures will only help a little, but they are better than nothing,” he said.
Despite the relief measures, Lam said the key to boosting businesses was bringing the epidemic under control and restoring consumer confidence.
This article Hong Kong budget: relief measures for small business better than nothing but not enough, bosses say first appeared on South China Morning Post