Hong Kong racing emerged from 2002 celebrating its ascension to a credible force at international level and that probably blanked out any negatives for the year. Now the streamers and fireworks are over and, for the time being, the weeks and months ahead hold, if not the resolution of, at least a continuing guide to some extremely vital fundamental issues. With turnover continuing to decline at around 10 per cent, it will remain the most closely watched aspect of Hong Kong's racing, however much the Jockey Club might hope that attention is focused on the horses and the racing and new-fangled ways of interpreting it. The Club has already enhanced its televised coverage in the New Year with the excellent distance markers in the straight and we will have all the extra knowledge imaginable with the Star Wars timing system of STRIDE to come soon. Yet, as far as this writer has ever witnessed, clubs throughout the world may prefer to be thought of as entertainment outlets, but betting greases all the wheels and a problem with the dollars will always get more attention than the most stirring of photo finishes. If that double digit-drop continues through to the end of this term, it would be the largest, and an acceleration, of the falls which have occurred annually since 1997. A continued decline of even that magnitude is still unlikely to have any negative impact on things like prizemoney or livery charges, but could cause more noticeable inroads into what ends up back in the pockets of government and charities. And in a difficult time for all, there will be increased pressure from those institutions to maintain levels. Last year, turnover did seem to kick off badly then find its way back to the pre-season forecast of a four per cent drop by January, then maintain that through the rest of the season. That has not been the case this time around and the Club will come into the second half of 2002-2003 with a consistent drop since September and everything to do if the final result is to be anything less awful. Then racing will face a new bogey in the early months of next season - Jockey Club-run soccer betting which will become the largest new piece of the turnover puzzle. Some professional high-rollers estimate the negative effect on race betting will lead to a further 20-25 per cent reduction. The other equally important betting issue will be restructuring the Club's taxation from a turnover tax to a profit and loss tax to allow a more versatile takeout from the wagering pools. Because of the way soccer betting will have to work in order to really 'work', issues around soccer betting and tax restructuring are going to be cousins, if not even more closely related. A freer tax structure would, in theory, allow the Club to quash illegal rivals and attract more professional money with lower takeout rates. But theory shmeory, it may take a brave act to move to lower the takeout in the face of continuing 10 per cent falls. In the good news basket, we are hoping the Club is right to highlight the horses following that fine international meeting, but we are careful to err on the side of caution. Remember, the Japanese horses had won four of the last five international races in Hong Kong before December 15 and returned with zero from it. Hong Kong racing may have come of age on December 15, but beware the hangover. Having the key to the door is not the same as being able to turn it. Never let it be said the Jockey Club is prepared to call the job done, though, and we hope that owners and trainers will heed the call to race abroad and take the message of good news for modern Hong Kong racing. We hope and expect that this will become a more frequent and noteworthy aspect of Hong Kong racing, with more trainers joining the usual suspects in 'playing away' at the top level. The Macau Question remains, too. What arrangement, if any, will be agreed by the clubs on both sides will make an interesting undercard during the next few months. Despite a few grunts and animal noises in August, Macau has been remarkably soft on the issues causing massive damage to its turnover following Hong Kong's law changes. Talks continue at glacial pace, but there is still the potential for the smaller club to go feral, operate on Hong Kong racing without its blessing and slice further chunks off its turnover. The latest development has been no more than more moves to continue discussions, although there has been scuttlebutt that Macau and Hong Kong will become agents for each other's betting pools. We can't quite see what's in it for Hong Kong, but after the Macau-trained Royal Treasure and Stanley Ho-owned Thunder were able to find there way into the big races on International Day, well, anything's possible. We have seen a seamless transfer of judicial control to new chief stipe Jamie Stier, but another department may not be as calm. The mild skirmish over vet issues which occurred during International week has the potential to blow up this month, as it did in January last year, with each side of the arguments having pinned the other's name to the fridge door under the heading 'Axis Of Evil'.