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19 March 2003 4689 LEGISLATIVE COUNCIL ─ 19 March 2003 4689 OFFICIAL RECORD OF PROCEEDINGS Wednesday, 19 March 2003 The Council met at half-past Two o'clock MEMBERS PRESENT: THE PRESIDENT THE HONOURABLE MRS RITA FAN HSU LAI-TAI, G.B.S., J.P. THE HONOURABLE KENNETH TING WOO-SHOU, J.P. THE HONOURABLE JAMES TIEN PEI-CHUN, G.B.S., J.P. DR THE HONOURABLE DAVID CHU YU-LIN, J.P. THE HONOURABLE CYD HO SAU-LAN THE HONOURABLE ALBERT HO CHUN-YAN IR DR THE HONOURABLE RAYMOND HO CHUNG-TAI, J.P. THE HONOURABLE LEE CHEUK-YAN THE HONOURABLE MARTIN LEE CHU-MING, S.C., J.P. THE HONOURABLE ERIC LI KA-CHEUNG, J.P. DR THE HONOURABLE DAVID LI KWOK-PO, G.B.S., J.P. THE HONOURABLE FRED LI WAH-MING, J.P. DR THE HONOURABLE LUI MING-WAH, J.P. 4690 LEGISLATIVE COUNCIL ─ 19 March 2003 THE HONOURABLE NG LEUNG-SING, J.P. THE HONOURABLE MARGARET NG THE HONOURABLE MRS SELINA CHOW LIANG SHUK-YEE, G.B.S., J.P. THE HONOURABLE JAMES TO KUN-SUN THE HONOURABLE CHEUNG MAN-KWONG THE HONOURABLE HUI CHEUNG-CHING, J.P. THE HONOURABLE CHAN KWOK-KEUNG THE HONOURABLE BERNARD CHAN, J.P. THE HONOURABLE CHAN KAM-LAM, J.P. THE HONOURABLE MRS SOPHIE LEUNG LAU YAU-FUN, S.B.S., J.P. THE HONOURABLE LEUNG YIU-CHUNG THE HONOURABLE SIN CHUNG-KAI THE HONOURABLE ANDREW WONG WANG-FAT, J.P. DR THE HONOURABLE PHILIP WONG YU-HONG THE HONOURABLE WONG YUNG-KAN THE HONOURABLE JASPER TSANG YOK-SING, G.B.S., J.P. THE HONOURABLE HOWARD YOUNG, J.P. DR THE HONOURABLE YEUNG SUM THE HONOURABLE YEUNG YIU-CHUNG, B.B.S. THE HONOURABLE LAU CHIN-SHEK, J.P. LEGISLATIVE COUNCIL ─ 19 March 2003 4691 THE HONOURABLE LAU KONG-WAH THE HONOURABLE LAU WONG-FAT, G.B.S., J.P. THE HONOURABLE MIRIAM LAU KIN-YEE, J.P. THE HONOURABLE AMBROSE LAU HON-CHUEN, G.B.S., J.P. THE HONOURABLE EMILY LAU WAI-HING, J.P. THE HONOURABLE CHOY SO-YUK THE HONOURABLE ANDREW CHENG KAR-FOO THE HONOURABLE SZETO WAH THE HONOURABLE TIMOTHY FOK TSUN-TING, S.B.S., J.P. DR THE HONOURABLE LAW CHI-KWONG, J.P. THE HONOURABLE TAM YIU-CHUNG, G.B.S., J.P. DR THE HONOURABLE TANG SIU-TONG, J.P. THE HONOURABLE ABRAHAM SHEK LAI-HIM, J.P. THE HONOURABLE LI FUNG-YING, J.P. THE HONOURABLE HENRY WU KING-CHEONG, B.B.S., J.P. THE HONOURABLE TOMMY CHEUNG YU-YAN, J.P. THE HONOURABLE MICHAEL MAK KWOK-FUNG THE HONOURABLE ALBERT CHAN WAI-YIP THE HONOURABLE LEUNG FU-WAH, M.H., J.P. DR THE HONOURABLE LO WING-LOK 4692 LEGISLATIVE COUNCIL ─ 19 March 2003 THE HONOURABLE WONG SING-CHI THE HONOURABLE FREDERICK FUNG KIN-KEE THE HONOURABLE IP KWOK-HIM, J.P. THE HONOURABLE LAU PING-CHEUNG THE HONOURABLE AUDREY EU YUET-MEE, S.C., J.P. THE HONOURABLE MA FUNG-KWOK, J.P. MEMBER ABSENT: THE HONOURABLE CHAN YUEN-HAN, J.P. PUBLIC OFFICERS ATTENDING: THE HONOURABLE DONALD TSANG YAM-KUEN, G.B.M., J.P. THE CHIEF SECRETARY FOR ADMINISTRATION THE HONOURABLE ELSIE LEUNG OI-SIE, G.B.M., J.P. THE SECRETARY FOR JUSTICE THE HONOURABLE MICHAEL SUEN MING-YEUNG, G.B.S., J.P. SECRETARY FOR HOUSING, PLANNING AND LANDS DR THE HONOURABLE YEOH ENG-KIONG, J.P. SECRETARY FOR HEALTH, WELFARE AND FOOD THE HONOURABLE MRS REGINA IP LAU SUK-YEE, G.B.S., J.P. SECRETARY FOR SECURITY THE HONOURABLE STEPHEN IP SHU-KWAN, G.B.S., J.P. SECRETARY FOR ECONOMIC DEVELOPMENT AND LABOUR LEGISLATIVE COUNCIL ─ 19 March 2003 4693 DR THE HONOURABLE SARAH LIAO SAU-TUNG, J.P. SECRETARY FOR THE ENVIRONMENT, TRANSPORT AND WORKS THE HONOURABLE FREDERICK MA SI-HANG SECRETARY FOR FINANCIAL SERVICES AND THE TREASURY CLERKS IN ATTENDANCE: MR RICKY FUNG CHOI-CHEUNG, J.P., SECRETARY GENERAL MRS JUSTINA LAM CHENG BO-LING, ASSISTANT SECRETARY GENERAL MR RAY CHAN YUM-MOU, ASSISTANT SECRETARY GENERAL 4694 LEGISLATIVE COUNCIL ─ 19 March 2003 TABLING OF PAPERS The following papers were laid on the table pursuant to Rule 21(2) of the Rules of Procedure: Subsidiary Legislation/Instruments L.N. No. Import and Export (General) Regulations (Amendment of Seventh Schedule) (No. 3) Notice 2003 ............ 68/2003 Inland Revenue (Amendment) Ordinance 2003 (5 of 2003) (Commencement) Notice 2003 ....................... 69/2003 Other Papers No. 70 ─ The Lord Wilson Heritage Trust Annual Report 2001-2002 No. 71 ─ Employees' Compensation Insurance Levies Management Board Annual Report 2001/2002 No. 72 ─ Vocational Training Council Annual Report 2001/2002 Report of the Bills Committee on Housing (Amendment) Bill 2002 Report of the Bills Committee on Registration of Persons (Amendment) Bill 2001 ORAL ANSWERS TO QUESTIONS PRESIDENT (in Cantonese): Questions. First question. LEGISLATIVE COUNCIL ─ 19 March 2003 4695 Access to Mainland Aviation Market 1. MR ERIC LI (in Cantonese): Madam President, in view of the growing importance and rapid expansion of the mainland aviation market, will the Government inform this Council of the actions it intends to take to assist all Hong Kong airlines to have access to this market? SECRETARY FOR ECONOMIC DEVELOPMENT AND LABOUR (in Cantonese): Madam President, the provision of air services between Hong Kong and the Mainland is governed by the Mainland/HKSAR Air Services Arrangement (the Arrangement). The Arrangement provides a framework which is conducive to the development of air services between the two places. The airlines designated by either side may operate services in accordance with the capacity and routes set out under the Arrangement. The format and framework of the above Arrangement are in principle similar to those of the bilateral air services agreements or arrangements between Hong Kong and our aviation partners. These bilateral air services agreements or arrangements are signed between Hong Kong and our aviation partners after consultation between the Government of the Hong Kong Special Administrative Region (SAR) and the Governments of the aviation partners concerned. In general, these agreements or arrangements provide airlines designated by each side with certain traffic rights including the routes and capacity for service operations. Airlines may operate scheduled air services in accordance with the provisions in the agreement or arrangement concerned. In order to enhance Hong Kong's status as an international and regional aviation centre and a logistics hub, the SAR Government has been expanding Hong Kong's aviation network. To this end, we continue to discuss and conclude air services agreements and arrangements with new aviation partners. We also regularly review with our aviation partners our existing air services agreements or arrangements to progressively liberalize Hong Kong's air services network to enable airlines to expand services. After the Government has concluded air services agreements and arrangements with aviation partners, it becomes purely a commercial decision of the airlines to utilize the routes and capacity provided for under these agreements and arrangements, including the development of new routes or increasing 4696 LEGISLATIVE COUNCIL ─ 19 March 2003 services on a particular route. The Government's role is to provide an appropriate framework to facilitate airlines' operation and expansion of services. There are close economic ties between the SAR and the Mainland. With the rapid economic growth of the Mainland, the demand for air transport between the two places will continue to grow. It is important for Hong Kong to further enhance our transport links with the Mainland to facilitate the flow of people and cargo. Since 2001 we have discussed with the Civil Aviation Administration of China (CAAC) annually expansion of the Arrangement, resulting in an increase in the number of routes and capacity that airlines of both sides can operate. Statistics from the Civil Aviation Department show that there has been steady growth in air traffic between Hong Kong and the Mainland. Between 1999 and 2001, the number of passengers carried between Hong Kong and the Mainland increased by an average annual rate of 7.9% while the cargo carried increased by an average annual rate of 8.2%. In the first 11 months of 2002, the passenger and cargo carried increased by 7.8% and 31.1% respectively over the same period of 2001. We believe that there is good potential to further develop the Hong Kong/Mainland air services market. At present, there are air services between Hong Kong and 39 cities in the Mainland and Hong Kong airline provides scheduled services to 19 of these cities. This shows that there is still room for expansion of services between Hong Kong and the Mainland. We support Hong Kong airlines to proactively develop these services under the framework of the Arrangement to strengthen the transport links between Hong Kong and the Mainland. Enhancing the air links between Hong Kong and the Mainland will reinforce and strengthen Hong Kong's competitive advantages as a leading international and regional aviation centre and logistics hub. This will facilitate economic co-operation between Hong Kong and the Mainland as well as the development of the local tourism industry, bringing about positive impact on the economies of both places. Therefore, when discussing expansion of the Arrangement with the mainland authorities, it has been our objective to progressively expand traffic rights for both sides. As in the case of Hong Kong's air services arrangements with other aviation partners, the expansion of the Arrangement with the Mainland needs to be discussed and agreed by both sides. LEGISLATIVE COUNCIL ─ 19 March 2003 4697 MR ERIC LI (in Cantonese): Madam President, it seems that a supplementary policy is attached to the Arrangement, which the Secretary referred to in his main reply, and that is, the "one airline one route" policy.
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