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[Press release] SMEs hit hard by economic downturn faces critical liquidity freeze Charles Mok and IT sector call for immediate cash relief to ICT enterprises

(9th April, 2020) In response to the second round relief measures issued by the government yesterday, IT legislator Charles Mok joined by a group of IT associations, industry stakeholders, startups and e-sport industry made a public appeal for more government relief, citing insufficient support to the ICT sector and expressed deep disappointment that much-needed rental subsidies are still absent.  


“The wage subsidy and the Distance Business Programme will render some relief to the sector but for the more important part about the rental support, SMEs and startups operating in other commercial properties are still deprived of the same support offered to their counterparts in the Science Park and Cyberport,” said Mok.


Francis Fong, Honorary President of Hong Kong Information Technology Federation and Lento Yip, Chairman of the Hong Kong Internet Service Providers Association, both expressed reservations about the new relief measures, saying the measures are not direct enough and that freelance workers are left out.


Yip saw a significant fall in the businesses related to data centre and cloud services. Victor Choi, Chairman of the Hong Kong Electronics and Technologies Association, and Roy Law, Chairman of the Hong Kong Wireless Technology Industry Association, echoed the same message, each presented the steep business challenges facing ICT companies and technology retail businesses. Law urged the government to step up in procuring services and products from local technology firms in a bid to support the sector. He also requested the government to streamline and facilitate the applications of various government fundings. 


Startups are especially fragile to the economic impact brought by the virus. Edmund Lee, Chairman of the Technology Incubation Network regarded the wage subsidy insufficient and warned that many startups are facing imminent cash flow problems which more immediate measures are critical for their survival. 


Jeffrey Cheng, CEO of Ooosh Coworking Spaces, saw the wage subsidy coming too late as many startups have already laid off their staff. As rent payment is one of the biggest operation costs for startups, Cheng called on the government to provide immediate rental relief measures.


Also taking severe hit by the coronavirus is the gaming industry which Roy Kwong, Vice President of the Hong Kong Electronic Sports Federation Limited, Tristan Law, Co-founder of Godzpeed, and Cat Lam from Kowloon Estadium Ltd pointed out that all companies across the industry are impacted by the virus and the current prohibition on public gatherings and that up to 90% of live broadcasters and workers from production companies were laid off as a consequence. They called on the government to provide an one-off subsidy and more measures to help the industry to transform their businesses.


“Tens of billions of taxpayer money have been invested in the innovation and technology ecosystem over the past few years. With such a tremendous crisis ahead, I urge the government to support our industry by increasing demand for local technology solutions and provide direct and immediate relief to IT companies. If our small businesses go under in this downturn, the industry will be devastated and years of policy support and local talent might be in jeopardy.” said Charles Mok. Mok has requested a meeting with the Secretary for Innovation and Technology Nick Yang to discuss the relief proposal.

Office Of Hon. Charles Mok, Legislative Councillor (IT)