A HK$5.4 billion ($700 million) cash bailout plan for Ocean Park Hong Kong is expected to be scrutinized on Tuesday by the Legislative Council’s Finance Committee, which will decide whether to approve the rescue package for the cash-strapped signature park to prevent its closure.
The government does not want to see the homegrown Ocean Park become the first victim of the COVID-19 pandemic fallout, but strategic repositioning is needed for the park’s long-term financial sustainability, Commerce and Economic Development Secretary Edward Yau Tang-wah said on Saturday.
The government does not want to see the homegrown Ocean Park become the first victim of the COVID-19 pandemic fallout, but strategic repositioning is needed for the park’s long-term financial sustainability Edward
commerce and economic development secretary
Yau said on a radio show that he believes the park will bring financial benefits with its strengths in the future as it redefines its strategic plans.
He pledged that government departments such as the Development Bureau will help the park find cooperation and development opportunities with surrounding districts in the coming six months.
Yau stressed that Ocean Park is not expected to apply for government grants every year as the park itself needs to adjust its strategy for sustainable development.
In early January, the 43-year-old Ocean Park sought a HK$10.64 billion cash injection from the SAR government for long-term development. Yau pointed out that the cash flow of Ocean Park would have been enough to support it through this year if the COVID-19 pandemic hadn’t happened.
But because of the health crisis, the park has been closed since Jan 26, which will drain its cash flow by June, Yau told.
On Friday, the government came up with an urgent rescue package of HK$5.4 billion and sought the Finance Committee’s approval to ensure the park survives the next 12 months. The funding will also help the park to retire HK$3 billion in commercial debt.
If the park is not able to obtain funds before the end of June, it may shut down with the loss of 2,000 full-time jobs, Yau said.
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, more than doubling its deficit of HK$236.5 million of the previous year.
Meanwhile, the coronavirus pandemic has brought unprecedented challenges for the city’s struggling tourism industry, with border controls enacted to curb the transmission of coronavirus.
The government’s latest figures showed that total visitor arrivals in April plunged to a tiny fraction of what they were last year, with only 4,125 tourists visiting the city last month.
The Hong Kong Tourism Board said it will help to revive the city’s tourism sector in three stages after the pandemic abates. The board suggested that until then, Hong Kong reposition its tourism strategic plans for long-term development.
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