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January, 2012:

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Tetronics Treatment of Asbestos Containing Material

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Tetronics’ Organics Datasheet.

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Reclamation sites proposed by HK Govt

Download PDF : Reclamationsites

Dioxins Hong Kong proposed Incinerator

From: Prof AJ Hedley/School of Public Health, HKU [mailto:commed@hku.hk]
Sent: Thursday, January 05, 2012 15:14
To: jschofs@netvigator.com
Cc: twwong@cuhk.edu.hk
Subject:

To:     John Schofield (email: jschofs@netvigator.com)
Treasurer, Living Islands Movement
Cc:     Professor TW Wong, School of Public Health, Chinese University of Hong Kong
From:   Anthony Hedley
Date:   January 5, 2012

Dear Mr Schofield,

Thankyou for your letter and apologies for the slow response.  I was working in a medical school in Thailand and then transferring to Hong Kong where I will be until 20 January.

I do not claim to be an expert on the technology of incinerators although I try and follow the developments in that field.  Jim Middleton (“Clear The Air”) and others have maintained a useful flow of bulletins on that issue.  As a medical practitioner and public health specialist I have an interest in exposure assessment to dioxins and dioxin-like compounds and we have done some work in that field in recent years.  A complete set of the papers we have published so far on persistent organic pollutants is attached.  They are necessarily quite technical and may not be very useful to you.  However a one page executive summary has potentially helpful diagrams and text and the paper in “Environmental Health Perspectives” conveys some of our concerns about dioxin control, albeit from a 5 year old perspective.  They show where Hong Kong is in terms of its risk status with regard to dioxins and PCBs.

The dioxin level in human breast milk is the best and most relevant indicator of past exposure of a population or its subgroups.  It is relevant because young primagravidae (first pregnancy mothers) pass on their dioxin load to the infant during gestation and then “top it up” if they breast feed.  We usually get a large proportion of our dioxin load from our mothers, which may then be added to through the dioxin content of our diet.  So the trans generational effect should be seen as an important reason for contemporary civic responsibility.  Humans are particularly susceptible to environmental persistent organic pollutants because they are amplified in the food chain and lipophilic, so stored in body fat rather than being eliminated.

One point I should make emphatically is that we have made a special effort to ensure that although breast milk is a conduit for dioxin from mother to infant, this must not be regarded as a reason not to breast feed.  The evidence which is available suggests that breast milk is likely to protect against adverse effects at least to some extent.  This may appear to be an uncomfortable paradox but it is the best position to adopt for many reasons.

The World Health Organization (WHO) has run 3 global surveys so far on dioxin in breast milk.  We joined the 3rd one in 2001/02 with funding from the Conservancy Association.  This was the first time Hong Kong participated, although a paediatric research group (Dr Henrietta Ip) had done studies in the late 1970s and 1980s.  Comparisons between studies to identify trends are hazardous because the assays were done in different laboratories.  (Our data were generated in the WHO reference laboratory in Freiburg, the only lab with the credentials to do this in the global survey).  However it would be fairly safe to say that over the years the levels of most pollutants had declined in Hong Kong mothers possibly due in part to the closure of old incinerators as well as other regional and global regulations and controls on PCBs and sources of dioxins.

A new survey has just been completed by my colleague Professor TW Wong at Chinese University School of Public Health.  I am copying this to him so that he might add to my comments and perhaps summarize the findings of this latest data.  We have jointly applied for funding to follow-up the infants born to our 2001 mothers, but no decision yet.

My summary comments in an effort to address your questions would be:

1.   Hong Kong (and any jurisdiction) should adopt a rigorous precautionary approach to the control of pollutant emissions which bioaccumulate in animal food sources and human tissues.

2.   Dioxin compounds are rated as some of the most highly toxic chemicals in the environment.  They have been shown to be associated with severe damage to the central nervous system, immune system, reproductive and endocrine systems, skin disorders and a cause of cancers.  They are particularly important as “endocrine disruptors” in newborns and infants.

3.   Hong Kong was included in the 3rd WHO global and ranked 14th out of 26th for concentrations [Toxic Equivalents (TEQ) expressed as picograms per gram of fat (pg/g fat)] for polychlorinated benzodioxins (PCDD) and polychlorinated dibenzofurans (PCDF) (ie “Dioxins” and dioxin-like compounds).  Hong Kong ranked 17th out of 26th for concentrations of Polychlorinated Biphenyls (PCB).  The Hong Kong/PRD values were lower than at least half of the other countries in the WHO survey.

However for all of these groups of structurally related chemicals Hong Kong had the highest levels in the Asia Pacific group which included USA, New Zealand, Australia, Philippines and Fiji.  Hong Kong levels were 40% above those of Australia.

4.   The particular susceptibility of Hong Kong mothers is emphasized by the strong association between age and body levels of dioxin.  Age of mother at age of first pregnancy dominates the risk profiles in terms of higher levels.  Late age at marriage and first pregnancy in Hong Kong means that even relatively lower life-time exposures will lead to substantial bioaccumulation and higher levels of dioxins being transferred to the unborn infant.  This observation emphasizes the need for an integrated environmental and public health approach, something which the present Environment Bureau may be incapable of achieving.

5.   Emissions of persistent pollutants contaminate both land and marine based sources of food at the lower end of the food chain.

Arguments based on emissions being “blown away” by prevailing winds are scientifically unacceptable and seriously misleading if they are allowed to influence policy making.  I understand these are suggestions made by EPD/EB staff to rationalize the project on Shek Wu Chau.

6.   The lower than average (or median) detected levels of dioxins in our survey are encouraging but extreme vigilance is required to ensure than further progress is maintained.  However in our paper in Environmental Health Perspectives 2006 we wrote:

“the public health threat of dioxin contamination in this region remains a concern.  The dioxin inventory in mainland China for 2002, the first so far, estimated PCDD/PCDF emissions to the atmosphere to be 7,144-13.575g International (I)-TEQ/year (Jun et al. 2004).  The China inventory does not include uncontrolled backyard burning of waste.  In Hong Kong, the annual emission was estimated to be 23-33 I-TEQ/year (HKEPD 2000).  One main reason for the high dioxin emission in mainland China is the heavy municipal waste management burden, together with its expanding population.  Most of the municipal waste incinerators in mainland China did not comply with the PCDD/PCDF national emission standard of 1.0 ng 1-TEQ/m3, which is less stringent than 0.1 ng 1-TEQ/m3 used in developed countries (Jun et al. 2004).  The growth of the economy was associated with the development of industries causing dioxin emissions, such as crude steel and chloralkali industries.  Active dioxin abatement policies and measures are needed to enforce a more stringent PCDD/PCDF emission standard for incineration, control illegal smuggling of electronics waste (Basel Action Network 2004; Schmidt 2002) for recycling activities and prohibit uncontrolled waste burning and ensure correct disposal of equipment and material containing PCBs.”

These caveats about mainland China can and should obviously apply to Hong Kong today.  In 2006 we assumed that any incineration technology adopted in Hong Kong would be state-of-the-art and ensure that pollutant emissions were minimized to the greatest possible extent.

This now appears not to be the case and is unacceptable from a public health viewpoint.  This is especially so, given that the EPD is apparently defaulting to depending on air movement to mitigate the impact of emissions locally and will only monitor mass concentrations four times a year.

7.   From an overall project management point of view I also would want to see an EIA which takes account of the high volume of marine traffic which will be needed to transfer waste to Shek Wu Chau.  If present types of fuel oil are used to power these vessels they will add another layer to pollution of Hong Kong’s inshore waters.

8.   At a personal level, from both an ecological and aesthetic point of view I would be implacably opposed to further despoiling of the seascapes in this part of the Hong Kong archipelago.  I cannot image how an option appraisal led to this choice.

Conclusion

My strong recommendation is that the further development of incineration should be based on advanced technology, particularly high temperature systems which destroy important toxins; rigorous independent environmental impact assessment; adoption of the precautionary principle; clear pathways for ministerial and bureaucratic accountability (almost totally lacking in environmental matters at present) and failsafe continuous monitoring linked to mechanisms for totally independent oversight of this aspect of environmental management.

The Environment Bureau should recognize that there is a total loss of public confidence in its current management practice and the incinerator proposal is a new entrant in this category.

I will help if I can, though my available time is severely limited at present because of many other commitments.  Also the public health concerns are clear and unambiguous: there should be the maximum possible reduction of all combustion emissions from waste incineration and the maximum possible reduction of waste generation on the shortest possible timescale.  I am concerned that Professor Northcote Parkinson’s satirical law, “Demand expands to fill capacity”, may be the main outcome of building a so-called super incinerator.

In the meantime please see if the Executive Summary (single sheet) and the paper in Environmental Health Perspectives lead to any further queries which we might try and answer.  Note these papers are the first two attachments.

With best regards,

Anthony J Hedley MD FRCP
Tel: 2819 9282 (Secretary Marie Chi)

1_executive summary

2_eph

3_est

4_chemosphere07

5_chemosphere08

6_chemosphere10

Creating islands no answer to lack of land, critics say

South China Morning Post – 5 Jan. 2012

Offshore sites for housing seen as wasteful and environmentally unsound

Building artificial islands for housing off the coasts of Hong Kong would be a major waste of resources and could threaten marine life, several experts said.

The government has floated the idea of building man-made islands to increase land supply, and the proposal is in the early stages of discussion.

Greg Wong Chak-yan, a veteran civil engineer and former vice-chairman of the Town Planning Board, said that while such a venture was feasible, it was not necessary at the present time. “Artificial islands are feasible in engineering terms, but many people might ask why we must have these reclamations. Will some people become shelterless if we don’t create land from the sea?”

Wong said it would make more sense to move unpopular facilities like prisons to artificial islands rather than build new homes on them.

Dr Ng Cho-nam, a member of the Transport Advisory Committee who teaches geography at the University of Hong Kong, said the proposal served little purpose as there was still plenty of undeveloped land in the New Territories.

He said: “How could these [artificial] islands attract development, especially when there is still lots of land in Yuen Long and Tuen Mun for use?”

This sentiment was shared by Winston Chu Ka-sun, an adviser to the Society for Protection of the Harbour. He said the solution to the city’s housing shortage was developing more land in the New Territories. Construction on reclaimed land would be too costly, he said.

There are also environmental concerns in building man-made islands, according to groups such as the Hong Kong Dolphin Conservation Society and WWF Hong Kong.

Samuel Hung Ka-yiu, chairman of the society, called the idea ridiculous and said it would put marine creatures at risk.

Samantha Lee, from WWF, noted there were rich coral resources near Po Toi Island, while Tolo Harbour was a vital breeding ground for animals. “We do not oppose all reclamation but some sensitive sites have to be avoided,” she said.

Green Sense president Roy Tam Hoi-pong, meanwhile, said instead of providing unlimited land supply to support population growth, “the real challenge is capping the population”.

He said luxury housing on artificial islands might be aimed more at rich mainlanders rather than locals.

chifai.cheung@scmp.com

Strategic Alliance for Plasma Arc Metal Recovery Firm

http://www.waste-management-world.com/index/display/article-display/6318907055/articles/waste-management-world/markets-policy-finance/2012/01/Strategic_Alliance_for_Plasma_Arc_Metal_Recovery_Firm.html

January 5, 2012

Swindon, UK based Tetronics, a specialist in the use of direct current (DC) plasma to treat hazardous waste and recovermetals, has signed a Strategic Alliance Agreement with Harsco Metals Group.

According to Tetronics, through this alliance Harsco will seek to extend its technical offering with the addition of Tetronics’ DC plasma arc technology to the many potential areas of hazardous waste treatment and metal recovery as well as into new applications and territories.

Harsco has a wide global presence in over 50 countries and an interest to invest in commercially viable plasma arc facilities involving the build, ownership and operation of such facilities for the benefit of Harsco’s existing and new customers.

Tetronics said that the process chemistry in its plasma technology is designed to symbiotically and preferentially separate and recover the valuable material in a range of wastes whilst destroying any hazardous components.

The company further claimed that the remaining non-valuable material is vitrified into an inert, safely disposable, non-hazardous material – Plasmarok – in a single processing step, while the minimal number of moving components within the plasma systems delivers longevity.

Tetronics said that Harsco has already operating and maintaining its DC plasma arc technology for 20 years at its Plasminox project in Terni, Italy, where it has been recovering valuable metals from the Electric Arc Furnace dust that is generated by an adjacent stainless steel manufacturing process.

Jeremy Makepeace, vice president Global Solutions (Non ferrous) at Harsco Corporation explained that the plasma technology will enable Harsco’s customers to recover valuable resources from waste that they can reuse in their manufacturing processes in a sustainable “closed loop model” thereby ensuring security of supply of key resources.

“The reality is that how we manage waste today will change dramatically in the next 5-10 years, with traditional waste management solutions being increasingly challenged on regulatory compliance, corporate & social responsibility and economic cost grounds,” added Makepeace.

Read More

Partners use Plasma to Recover Precious Metals from WEEE in Taiwan
Tetronics has formed a partnership with Taiwan based Solar Applied Materials Technology to investigate the potential to use plasma technology for the extraction of valuable metals from WEEE across the far east.

Plasma arc and Gasification Technology to be used in Peterborough
Direct current plasma arc technology has been finally signed for use by Peterborough Renewable Energy to deal with Air Pollution Control residues created onside at EnergyPark Peterborough.

Canadian plasma arc gasification ready for take off after U.S. Navy trial
Canadian plasma technology manufacturer, PyroGenesis, has completed the testing of its Plasma Arc Waste Destruction System with the U.S. Navy and is ready to roll out the process into marine and land-based markets.

Javelin Park Investigation – UK plant filters ‘let particulates through’

10:20am Wednesday 4th January 2012

By Chris Warne

STRICT regulations forbidding the emission of tiny particles from incinerators are needed to safeguard public health, warns Dr Dick van Steenis.

Ultrafine PM1 and PM2.5 particulates which are released when waste is incinerated are causing premature infant and child deaths, he believes.

Dr van Steenis also claims these particles, which are small enough to be inhaled by humans, are linked to a host of other adverse health effects, including birth defects, childhood cancers, respiratory illnesses and heart attacks.

In evidence submitted to a House of Commons select committee in May last year, Dr van Steenissaid the Environment Agency had admitted that 90 percent of PM1s and 35 per cent of PM2.5s escape through filters installed in UK incinerators.

This, the retired GP claimed, meant that UK incinerators were emitting somewhere between 40 to 120 times more particulates than those in Finland or Sweden, where air quality regulations are tighter.

In his submission to the Environmental Audit Committee, Dr van Steenis also criticised the Health Protection Agency for failing to examine data at ward level, which would allow the HPA to assess the health impact of incinerator fumes.

The HPA has so far refused to look at ONS figures despite it being recommended by the World Health Organisation, he said.

GLOSVAIN protesters and Lib Dem county councillors have been calling on Gloucestershire County Council to consider a mechanical biological treatment (MBT) plant as an alternative to the Javelin Park incinerator.

However, Dr van Steenis is equally opposed to that option on the grounds that a large amount of leftover waste from MBT plants still has to be incinerated or put into landfill.

“What we should be looking at are plasma arc gasification plants because they break everything down into atoms,” he said.

Dr van Steenis believes plasma arc gasification plants are the safest and most environmentally friendly option and are capable of generating more energy from waste than incinerators.

© Copyright 2001-2012 Newsquest Media Group

http://www.stroudnewsandjournal.co.uk

Download PDF : TATA9c

Download PDF : IncineratorReport_v3

Download PDF : Incinerator HPA Response

Future sites for reclamation unveiled

South China Morning Post – Jan. 4, 2012

The government on Wednesday proposed 25 reclamation sites around the coast of Hong Kong as part of efforts to increase the amount of land available for building.

The sites, which include the outlying islands of Cheung Chau, Hei Ling Chau and Lamma, could provide 1,500 hectares of artificial land, the government said.

The location of the sites was released on Wednesday, a month and a half after the start of a public consultation on ways to increase the land supply, which will end in February.

A Development Bureau official said the sites listed were only possibilities put forward for public debate.

Robin Li Kui-biu, a chief engineer in charge of harbour projects, said the sites were examples provided to assist discussion on the criteria for selecting sites, if reclamation outside Victoria Harbour was accepted as an option to increase land supply in the long term.

The consultation asks the public if they agree with eight proposed criteria for site selection, including; whether a project meets local needs, its environmental impact, and cost effectiveness.

No reclamation is proposed within the much-shrunken but now protected Victoria Harbour, or in Hong Kong’s marine parks.

Today’s list does include five sites in Tolo Harbour, two in Silver Mine Bay on Lantau Island, one in Sandy Bay on Hong Kong Island and several in Tuen Mun.

Other large reclamation sites on the list are at Beaufort Island, Peng Chau, Siu Ho Wan, southwest Tsing Yi and Lung Kwu Tang.

The government wants to create enough land to build 40,000 flats a year. It has said that, as well as providing land, reclamation would be a ‘green’ way to dispose of construction fill, much of which is now shipped to the mainland.

But environmentalists want the government to consider methods other than reclamation.

The chief executive of environmental watchdog Green Power, Man Chi-sum, said in November – when the consultation was launched – that priority should always be given to using abandoned or abused land in the New Territories.

Press Invitation

http://www.epd.gov.hk/epd/english/boards/advisory_council/eia_member.html

(with effect from 1 January 2011 for two years)

http://www.itc.gov.hk/en/quality/hkas/doc/hoklas/039.pdf

Mr. TSANG Kam-lam, J.P. (Chairman)     General Manager of HKPC Environment and Product Innovation Lab

Environmental Impact Assessment Subcommittee  Membership List
Professor CHAU Kwai-cheong, J.P. (Deputy Chairman)
Ms. AU Pui-yee, Teresa
Dr. CHAN YUEN Tak-fai, Dorothy, B.B.S.
Professor FUNG Tung
Ms. HO Siu-fong, Betty
Mr. LAU Che-feng, Edwin, M.H.
Professor LEE Hun-wei, Joseph
Professor LI Xiang-dong
Dr. LO Wai-kwok, B.B.S., M.H., J.P.
Dr. MAN Chi-sum, J.P.
Miss NG Yuen-ting, Yolanda
Mr. WONG Ka-wo, Simon, J.P.
Dr. YAU Wing-kwong
Dr. YEP Kin-man, Ray

Please read the news from Oriental Daily today :

It says the chair of EIA subcom who works in HKPC, and HKPC has got a work contract with EPD to measure the air quality around SKC after the first round of EIA meetings for the incinerator.  So you may wonder why the chair of EIA subcom did not declare potential conflict of interest before the EIA meeting on 5 Dec and on 30 Dec (even this is the second round to review the the same EIA of incinerator).   There was another member who has declared potential conflict of interest in the EIA and ACE meetings, and she was advised to excuse herself from the meetings.

港聞
A23
東方日報 2012-01-04

焚化爐環評疑涉利益衝突

【本報訊】環境諮詢委員會通過屯門曾咀及石鼓洲興建焚化爐環評報告。有份通過報告的環諮會轄下環境影響評估小組主席曾錦林,其受僱的生產力促進局去年原來受環境保護署委託,監測石鼓洲空氣質素,蒐集數據,曾錦林被質疑有利益衝突之嫌。有環諮會委員認為,為避嫌應申報利益。曾錦林強調,去年四月首次通過焚化爐環評報告後,生促局才接受委託,為環保署提供空氣資料,與環評報告無直接關係。

環保署指出,政府去年十月以公開招標方式,選出生促局環境管理部進行離島區包括石鼓洲、大嶼山南及長洲的空氣質素監測工作,量度污染物數據作參考之用,與焚化爐環評工作並無關係。

生促局環境管理部總經理曾錦林指出,沒有親自接手工作,加上環諮會大會及環境影響評估小組去年四月已通過焚化爐環評報告,只是遇上港珠澳大橋司法覆核撤回,再於上周重上討論。環諮會要求委員開會前申報利益,委員劉祉峰認為,雖然生促局的研究工作與環評報告未必有直接關係,但為避嫌,「應該提出來,由副主席同委員討論是否有衝突,決定是否需要避席!」

港聞
A08
太陽報 2012-01-04

通過石鼓洲環評 曾錦林疑利益衝突

【本報訊】環境諮詢委員會通過屯門曾咀及石鼓洲興建焚化爐環評報告。有份通過報告的環諮會轄下環境影響評估小組主席曾錦林,受僱的生產力促進局去年原來受環境保護署委託,監測石鼓洲空氣質素,搜集數據,曾錦林被質疑有利益衝突之嫌。有環諮會委員認為,為避嫌應申報利益。曾錦林強調,去年四月首次通過焚化爐環評報告後,生促局才接受委託,為環保署提供空氣資料,與環評報告無直接關係。

環保署指出,政府去年十月以公開招標方式,選出生促局環境管理部進行離島區包括石鼓洲、大嶼南及長洲的空氣質素監測工作,量度污染物數據作參考之用,與焚化爐環評工作並無關係。生促局環境管理部總經理曾錦林指,沒有親自接手工作,加上環諮會大會及環境影響評估小組去年四月已通過焚化爐環評報告,只是遇上港珠澳大橋司法覆核撤回,再於上周重新討論。據他了解,生促局提交的數據並沒有列載於環評報告,故他認為毋須申報。

環諮會要求委員開會前申報利益,委員劉祉峰認為,雖然生促局的研究工作與環評報告未必有直接關係,但為避嫌,「應該提出來,由副主席同委員討論是否有衝突,決定是否需要避席!」有委員則指,曾錦林所屬部門從事的工作只為環保署收集空氣數據,非直接撰寫環評報告,同意不需申報。

Tsang is breaking his tax cut pledge at the very worst time

SCMP – another broken promise from a Colonial era bureaucrat used to taking orders rather than making them

The chief executive’s back-pedalling on a vow to lower the city’s profits tax makes no sense when the government is running surpluses and sitting on huge reserves

It looks as if Donald Tsang Yam-kuen is going to renege on his promise to cut corporate taxes just when a tax cut is most affordable and exactly when it could do Hong Kong the most good.

It seems a long time ago now, but back in 2007 ahead of his re-election as chief executive, Tsang promised to cut the city’s profit tax rate to 15 per cent.

“If there’s economic growth, the chance of having tax cuts … is much higher,” he said at the time.

Since then Hong Kong has enjoyed growth, strong growth. Assuming the city’s economic output grew 5 per cent last year in line with the government’s November forecast, Hong Kong will have clocked up an average annual growth rate of 3.6 per cent in the five years since Tsang made his promise.

That might not sound much, but 3.6 per cent counts as rapid growth for an economy as developed as Hong Kong. And when you consider that the last five years have seen the worst global financial crisis and economic slump since the Great Depression of the 1930s, then by any reasonable measure Hong Kong’s economy has been steaming ahead at full speed.

But although Tsang did reduce the profits tax from 17.5 per cent to 16.5 per cent in 2008, it now looks as if he is going to welsh on his promise to cut the rate further to 15 per cent before he steps down in June.

“It’s hard to meet my vow to cut corporate tax,” he said in a radio interview yesterday. “We may see the emergence of a worldwide recession. So it’s hard to have room to do such a thing right now.”

His reasoning reveals an economic rationale so contorted, it is hard to believe Tsang was once reckoned one of Hong Kong’s stronger financial secretaries.

Sure, in Western Europe or the United States, the prospect of a recession makes it harder for governments to cut taxes. That’s because in a recession the unemployment rate rises, pushing up the cost of government welfare payments even as the overall tax take falls because of slowing activity.

As a result, government deficits soar. Tax cuts would only exacerbate the problem, pushing debt levels even higher.

But Hong Kong is an altogether different kettle of fish. The city is entering this downturn with what most developed economies would consider full employment. The government has few social security obligations; welfare payments make up a negligible portion of its expenditure. And it is not running a deficit, but a handsome surplus.

As the first chart shows, Hong Kong has consistently run budget surpluses for the last seven years. And according to accountants PricewaterhouseCoopers, it will turn in another for the financial year ending this March, recording an estimated surplus of HK$30 billion.

What’s more, the government has plenty of fiscal firepower in reserve. As the second chart shows, at the end of November it boasted accumulated fiscal reserves of HK$617 billion. Added to the exchange fund’s accumulated surplus of HK$567 billion, that means there is a whopping HK$1.2 trillion of spare cash in the kitty.

So it’s hard to see why Tsang thinks there’s no room for a tax cut right now. In fact, with plentiful reserves and a global slowdown looming, this is exactly the time that the Hong Kong government should be considering a little counter-cyclical tax reduction to stimulate economic activity.

It would be little, too. Last year the government collected HK$93 billion in profit tax. A reduction in the rate from 16.5 to 15 per cent would have reduced that take by roughly HK$8.5 billion, or just 2.2 per cent of overall revenues, barely enough to dent the budget surplus.

Granted, in a downturn a cut in corporate taxes coupled with the likely slump in property-related revenues could push the government’s budget into deficit.

But, as we’ve seen the government can afford to go into the red for a while and a downturn is exactly the time when it should be running a deficit.

A reduction in the profit tax in next month’s budget would boost business confidence, support economic activity and enhance Hong Kong’s competitiveness.

It’s what the city needs. Tsang should keep his promise.

tom.holland@scmp.com

Shenzhen ‘wants to kill’ HK factories

South China Morning Post – Jan 4, 2012

Of course Hong Kong still needs a third runway to handle the dwindling exports from the PRD ?

Manufacturers angered by the decision to implement pay rise next month, after municipal authorities had earlier offered to shelve any increase

Shenzhen’s minimum wage will rise from next month, ending a one-month delay to the increase rather than a year-long grace period that angry Hong Kong manufacturers had asked the municipal authorities for in December.

Manufacturers received government notices on Monday that the minimum wage will jump 13.6 per cent to 1,500 yuan (HK$1,850) on February 1, the second rise in 10 months and the highest minimum wage in the nation.

Major trade body representatives said they were disappointed at the special economic zone’s decision, especially since officials had earlier offered to shelve the pay rise.

Pauline Ngan Po-ling, the chairman of the Hong Kong Young Industrialists Council, said the decision effectively ignored manufacturers’ call for a one-year delay due to the escalating euro-zone crisis and poor demand in the United States.

Trade members met Shenzhen government officials and representatives of the Hong Kong Economic and Trade Office in Guangdong as recently as December 16.

“They assured us by promising to share our burden but two weeks later, they raised wages by almost 14 per cent,” Ngan said. “On the one hand, they say they will help us, on the other hand, they want to kill us.”

Ngan, the deputy chairman of Mainland Headwear, which runs a factory in Shenzhen with about 2,500 workers making caps for export, said the wage rise was ill-timed.

The increase would raise the company’s labour costs by 20 per cent and prompt it to set up its second production base outside the mainland, she said.

Higher wages have exacerbated manufacturers’ recent problems, which range from a credit crunch and dwindling orders to labour shortages and changing industrial policies.

A Grant Thornton survey revealed yesterday that confidence among Hong Kong businesspeople about the next 12 months sank to its lowest in the fourth quarter of last year. Their biggest worries were shrinking orders and profitability as a result of rising finance costs.

“We are disappointed at the sudden pay increase, which came at a very inappropriate time and hit badly our confidence in the prospect of the manufacturing sector,” said Jimmy Kwok Chun-wah, who runs petrochemical plant Rambo Chemicals in Shenzhen and is a deputy chairman of the Federation of Hong Kong Industries. “It looks like Shenzhen is testing how much pressure manufacturers can bear because it is the first and only region in Guangdong to lift minimum pay.”

Federation deputy chairman Stanley Lau Chin-ho said Guangdong provincial vice-governor Zhao Yufang promised last month that the province’s proposed minimum wage would be shelved from January 1, but did not say until when.

“We got this verbal promise during her visit last month, but she did not say when the proposals would be implemented,” Lau said.

After outcries from trade bodies, Guangdong put on hold two proposals that would have lifted the minimum wage by 16 per cent or 17.9 per cent on average.

Last week, the Ministry of Human Resources and Social Security said 24 provincial or regional governments raised minimum wages by an average of 22 per cent in 2011, a year in which labour disputes had sparked protests.

China Labour Bulletin spokesman Geoffrey Crothall said that at the existing levels, the minimum wage could not be considered “a living wage” and workers were still banking on overtime and allowances to make a decent living.

denise.tsang@scmp.com