Chief Executive John Lee announced in his 2025 Policy Address that the Government will support the local economy by helping small and medium enterprises (SMEs) and promoting economic diversification.
Mr Lee explained that the measures to enhance support for SMEs are aimed to better cope with the city’s economic restructuring.
“Hong Kong is home to some 360,000 SMEs, and they are the pillars of our economic development.“
He outlined that the Government will extend the application period for the 80% Guarantee Product under the SME Financing Guarantee Scheme for two years, and further extend the principal moratorium arrangement for one year.
To alleviate pressure on business operations, the Government will reduce water and sewage charges for non-domestic accounts by 50%, subject to a monthly ceiling of $10,000 and $5,000 respectively per account. About 260,000 non-domestic accounts are expected to benefit from the measure.
It will also reduce the trade effluent surcharge by 50%, which is expected to benefit about 35,000 businesses mainly in the catering industry. In addition, fees for the first issue or renewal of licences and permits, including those for hawkers, food businesses, agriculture and fisheries industries and liquor licences will be waived, which is expected to benefit over 60,000 licensees. These measures will be implemented for one year.
Considering that the original estimate for the Government’s average annual capital works expenditure in the coming five years was about $120 billion, Mr Lee said the Government will earmark an additional $30 billion in the next two to three years to increase expenditure on works projects driving sustained economic development, to support the local construction industry.
In addition, the Government will streamline the restaurant licensing regime and expedite the approval process of applications for outside seating accommodation of restaurants.
Mr Lee said: “The Food & Environmental Hygiene Department will adopt a new way by proactively co-ordinating various relevant departments to undergo ‘joint-vetting’ to resolve the matter together, and when necessary, escalate the process regarding complicated applications to the relevant Permanent Secretary or even the Deputy Chief Secretary for steer.
Additionally, the Government will inject $1.43 billion into the Dedicated Fund on Branding, Upgrading & Domestic Sales (BUD Fund) and expand its geographical scope to cover eight more economies, including Belt & Road countries. The Government will also enhance promotion and facilitate the participation of companies in exhibitions and export marketing activities through “Easy BUD” .
The Government will also increase financing support for local e-commerce businesses and expand the coverage of free buyer credit checks through the Hong Kong Export Credit Insurance Corporation.
To encourage local SMEs and startups to conduct more overseas visits exploring business opportunities, while bringing in more enterprises to invest in and establish businesses in Hong Kong, a functional platform “Economic & Trade Express” will be set up with the joint efforts of Economic & Trade Offices and overseas offices of Invest Hong Kong and the Trade Development Council.
Other SMEs support measures include enhancing Cyberport’s Digital Transformation Support Pilot Programme, implementing the “Creativity • E commerce – Beyond Limits” programme and providing one stop business matching and referral services, as well as launching a two-year pilot scheme to support local small and medium innovation and technology enterprises with patent evaluation.
On promoting economic diversification, Mr Lee said the Government will strengthen the competitiveness of local produce by introducing a unified brand for local agricultural and fisheries products in mid-2026 to enhance product awareness and brand value.
The Government will also issue culture licences for new fish culture zones and provide deep‑sea cages for rental by the fisheries industry, to increase local mariculture production by tenfold within 15 years.
Meanwhile, the Government will facilitate the livestock sector to construct the first environmentally-friendly, multi-storey pig farm, in Lo Wu. It will also take forward the Agricultural Park Phase 2 development, and promote leisure farming and fisheries.
The Chief Executive also announced the introduction of a licensing arrangement allowing operators to let dogs enter their food premises to promote a pet-friendly culture.
“According to government statistics, more than 240,000 households in Hong Kong keep more than 400,000 cats and dogs as pets, generating an enormous consumption market, including food and products, healthcare, insurance, grooming, training and more.
“Pet-friendly restaurants will create new business opportunities for the industry.”
Clear signage will be put up by permitted restaurants, so that customers know dogs are allowed.
Turning to labour support and protection, Mr Lee said the Government will ensure the employment priority of local workers and combat illegal employment rigorously.
He highlighted that to combat abuse of the Enhanced Supplementary Labour Scheme (ESLS), starting from tomorrow, when applying to import waiters or waitresses and junior cooks under the ESLS, employers are required to extend the local recruitment process from four weeks to six weeks, during which they must once a week attend an on-site job fair organised by the Labour Department.
The manning ratio requirement will also be more stringent. An employer applying to import a waiter or waitress and a junior cook must have already employed two local full-time waiters or waitresses and two local full-time junior cooks.
Mr Lee added that the Government will step up efforts to combat illegal employment, establish a dedicated hotline for reporting illegal workers, and strengthen intelligence collection and inter-departmental joint enforcement operations to safeguard the employment opportunities of local workers.
Moreover, the Government will improve the work injury compensation mechanism for digital platform workers through legislation in view of the prevalence of digital platforms.
