HK lawmakers demand information from government, Ocean Park on fresh HK$2.8 billion bailout plan

24-Feb-2021 Intellasia | South China Morning Post | 6:56 AM Print This Post

Hong Kong lawmakers have demanded more information from the government and debt-ridden Ocean Park over an additional HK$2.8 billion in funding to keep it afloat, despite agreeing to let the legislature’s Finance Committee decide on its future.

The Legislative Council’s economic development panel on Monday submitted the park’s recovery plan to the committee which will decide whether the embattled venue would be granted the additional funding.

Lawmakers agreed in principle with the concept to revitalise theme park into a resort with new retail, dining and entertainment initiatives, on top of its marine conservation commitments. But they remained sceptical about its hefty funding request and doubted its financial sustainability.

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The park in January unveiled plans to seek funding of HK$1.67 billion in working capital and another HK$1.12 billion for organising conservation and education activities.

The 44-year-old park’s request came after the government already granted it a HK$5.4 billion bailout last year, with the bulk of the money used to repay commercial loans and related financing costs for its redevelopment, including building a new water park.

The Water World park, a HK$4 billion attraction, is expected to open in August at the earliest and would charge guests an admission fee.

Lawmakers were left frustrated in a two-hour meeting on Monday during which Ocean Park, the city’s Tourism Commission and commerce secretary could not give a precise breakdown of the entertainment venue’s estimated ticketing revenue from the water attraction and the potential rental income it could generate from its proposed retail redevelopment.

Secretary for Commerce and Economic Development Edward Yau Tang-wah stressed that Ocean Park had to stay shut for nearly two-thirds of the time during the coronavirus pandemic and it needed support to fulfil its conservation causes.

The park’s restructuring plan also included a waiver of interest payments on government loans totalling some HK$813 million and a proposal for delayed repayment. The loan is projected to be fully repaid by 2059.

Ocean Park chair Lau Ming-wai said repaying commercial loans was a big financial burden for its operations, and hoped that the loan restructuring and fresh round of funding would help it relieve some stress.

Tourism sector lawmaker Yiu Si-wing said he reckoned the new way forward for the park was a step in the right direction and stressed that it should leverage on its natural environment to attract tourists and remain competitive. But he also urged the park to revise its ticketing revenue projections during the transition period when it would have to demolish its amusement rides.

Lawmaker Michael Tien Puk-sun said he remained concerned about the park’s financial sustainability, stressing that overheads of the Water World park such as its electricity bill, maintenance fees and salaries for staff would be high.

Tien said he was still not convinced the entertainment venue would be able to manage its costs in operating the new attraction, while also casting doubts on the long-term plans for attracting visitors to the new retail, dining and entertainment zones.

Commissioner of Tourism Joe Wong Chi-cho clarified that the park could not give an estimate on rental income from lowland redevelopment as it did not want to compromise on the outcome of tendering for a commercial partner.

Federation of Trade Unions lawmaker Kwok Wai-keung also questioned the feasibility of the park’s plans.

Lawmaker Elisabeth Quat echoed a similar view, pointing out that members of the public were concerned the government was just pumping money to save the stricken venue.

“We have no intention to keep coming back to the council for more money,” commerce secretary Yau said, adding that the park hoped the restructuring plan would help make it a self-financing entity again.

The park was allowed to reopen last Thursday when the government eased some social-distancing rules that had been in place since November last year to control the fourth wave of the pandemic.

https://sg.news.yahoo.com/hong-kong-lawmakers-demand-information-114531903.html

 

Category: Hong Kong

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