Tax breaks, industry policy 'not needed for investment'
There was no need for Hong Kong to have an industry policy or offer tax breaks to attract investors, Mr Tung said yesterday.
'Our land and labour costs are very expensive,' he told Election Committee members. 'If we introduce an industry policy to help some of the industries to develop, we haven't got the advantages,' he said.
The Chief Executive was responding to a query by Kenneth Fang Hung, of the textiles and garment sector, about his plans for developing industries if re-elected for another five years.
Mr Hung said: 'In recent years, we have faced a high unemployment problem, one of the reasons is that many industries have moved to the mainland.'
Mr Tung said instead of looking at new industries, Hong Kong should try to develop existing strengths in areas such as the service sector, transport and logistics.
'Hong Kong has the world's number one container terminal and the nearby Pearl River Delta is one of the world's largest production bases,' he said.
He added that the SAR was poised to take advantage of the mainland's entry to the World Trade Organisation, and the central Government had been positive about a possible free-trade agreement.
The finance chief last week met mainland trade officials to discuss closer economic ties. However, both sides warned the links would take a long time to develop, after local business leaders had urged they be pushed through quickly so the SAR could get a head start on foreign competitors.
In response to another question about whether the Government had shown enough initiative in attracting investment, Mr Tung said the impact on investors was always considered when policies were drawn up.
However, he played down the possibility of offering tax incentives, saying: 'Tax in Hong Kong is already very low. Nobody has requested me to do anything on it.'
