11 October 2004

Mr Henry Tang Ying Yen, GBS, JP
Financial Secretary
12/F., West Wing
Central Government Offices
Lower Albert Road
Hong Kong

Dear Henry,

I would like to draw your attention to the persisting high unemployment rate in the local construction sector in Hong Kong .

Despite the government's recent upbeat economic growth forecast of 7.5% for 2004 and the improved overall unemployment rate of 6.8%, the jobless rate of the construction industry stays at 16.3%. While our overall economy has benefited from the individual travel scheme of Mainland visitors, CEPA and the Pan-Pearl River Delta Regional Co-operation and Development Framework Agreement involving 9 provinces, HKSAR and Macau SAR, the construction industry is still at its doldrums. There are over 300,000 practitioners including professionals, technicians and workers in the industry. If we take their family members into account, there are over 1 million people at stake. It is imperative for the government to implement more public works projects to revive the industry. I have tried every avenue to draw senior government officials' attention including that of the Chief Executive to the seriousness of the problem. Obviously, my appeals have so far fallen on deaf ears.

As a matter of fact, the government may follow the examples of some foreign countries in increasing more public works projects during slowing economies with a view to creating more employment opportunities and saving construction costs because of lower tender rates. On the same basis, the government could invest the $26 billion proceeds from the recent bond issuance and the securitisation of 6 government-owned facilities in infrastructure development on top of $29 billion public works expenditure already earmarked. Under no circumstance should the government use these monies to finance the current deficit.

Given the good response of the public to the recent sales of government bond, the government should consider raising more money for infrastructure development through further bond issuance. By doing so, the government could make use of the resources of the private sector to finance infrastructure facilities which are essential for our future development. Moreover, additional public works expenditure will create more employment opportunities for the construction industry and spur the economy in general through the multiplier effect.

Indeed, the above suggestions should have been given serious consideration by the government, as they will make a big difference to the livelihood of the practitioners in the construction industry. However, the lukewarm responses from the government indicate otherwise. My repeated submissions to you and the Chief Executive on the subjects have so far earned only polite replies from policy bureaux as my letters landed lastly on their plates. I understand that it was not an easy task for these bureaux to perform this replying routine as they themselves are also victims of the government's budget squeeze. Those replies were not exactly speaking their minds.

Hence, I would like to ask for a favour from you this time. Please take some time to read this letter and let me know your views on the above suggestions. I hope that I am not asking too much.

Looking forward to receiving your prompt reply,

(signed)

Ir Dr Raymond Ho Chung-tai