This picture taken on May 4, 2020 shows workers walking in the grounds of the currently closed local theme park, Ocean Park, in Hong Kong. (PHOTO / AFP)
The Hong Kong government
said on Monday it is preparing a revised bailout plan to inject HK$5.4 billion
into cash-strapped Ocean Park, amid growing concerns that the city’s iconic
marine-life theme park will cease operations as early as June.
The park, which opened in southern Hong Kong Island in 1977, had already sought a HK$10.64 billion cash injection from the SAR government in January for long-term development.
Leo Kung Lin-cheng, chairman of the park’s board, said it has lost about HK$700 million in the past three months, with expenditures of around HK$140 million per month and revenue losses of HK$200 million
The coronavirus outbreak
has brought “unprecedented” operational and financial challenges soon after the plan was submitted to the Legislative Council’s
Finance Committee in late February, said
Secretary for Commerce and Economic Development Edward Yau Tang-wah.
“The park has since been
closed for more than three and half months. During the period, it had zero
visitors and reported zero income,” Yau noted.
“We also see great
difficulties ahead even when the park reopens in the future. The whole tourism
landscape, both locally and globally, will be undergoing major changes,” he
added.
READ MORE: HK Disneyland and Ocean Park to be closed from Sunday
Leo Kung Lin-cheng,
chairman of the park’s board, said it has lost about HK$700 million in the past
three months, with expenditures of around HK$140 million per month and revenue
losses of HK$200 million.
Yau said the new funds
will serve two purposes. One is to ensure the park survives the next 12 months,
while it redefines its strategic plans. The other is to help it retire HK$3
billion in commercial debt.
The government has also
proposed putting off repayments of the park’s two government loans amounting to
HK$3.6 billion.
Legislators will be
asked to scrutinize the revised plan on Friday. Yau said it is first time Ocean
Park had applied for government funding. In the past 40 years, the park had
always been able to finance itself.
ALSO READ: Hong Kong Ocean Park to reopen with shortened hours
If the park is not able
to obtain these funds before the end of June, it may shut down. This will be a
fatal blow to its 40-year reputation and successful branding. It could also
mean the loss of 2,000 full-time jobs, he added.
The park’s financial position had been getting worse in recent years. It has warned that its cash-flow deficit is expected to exceed HK$600 million in the 2019-20 fiscal year. It reported a deficit of HK$557.3 million for 2018-19 - doubling its deficit of HK$236.5 million for the previous year.
