The HKDL Source

According to The Standard:

 

Mickey Mouse and his mates at Hong Kong Disneyland look set for another massive cash handout - courtesy of the taxpayer.

 

The Standard has learned that the government has softened its stance on the theme park's second-phase expansion.

 

It is considering providing a lifeline to the theme park, where visitor numbers and sales have fallen short of projections.

 

Secretary for Commerce and Economic Development Frederick Ma Si- hang told The Standard the government would be inclined to inject funds for expansion so that it could continue to be a drawcard for visitors.

 

"I don't want to hear visitors saying they are seeing the same things they saw last year and lose interest in Disneyland," Ma said.

 

But he would not say how much capital the government would commit.

 

This is the first time the government has indicated its willingness to support the theme park, which Disney has stated may require extra financing.

 

Former secretary for economic development and labour Stephen Ip Shu- kwan previously made it clear the government had no intention of injecting funds.

 

Ma, in his earlier capacity as secretary for financial services and treasury, also suggested the government might sell its stake in the company that operates the theme park.

 

Ma's latest comments follow remarks by Chief Executive Donald Tsang Yam-kuen, who said early last month in a briefing following his policy address that he had asked the financial secretary to clarify the government's role and its level of participation as a shareholder in managing government- held assets, including Disneyland.

 

Also in mid-October, Ma and Financial Secretary John Tsang Chun- wah convened a cross-sector committee to review how the city can improve its attractions and outline strategies.

 

Since opening in 2005, the theme park has been climbing a financial mountain.

 

In May, Walt Disney said it would not be able to draw on a US$294 million (HK$2.28 billion) revolving credit facility, and may require alternative financing to meet operating and development needs.

 

Reporting that second-quarter earnings to the end of March rose 27 percent, Disney said guest spending, attendance and operating income at the Hong Kong theme park was lower.

 

Overall, revenue from parks and resorts rose 9 percent to US$2.4 billion while operating income rose 19 percent to US$254 million.

 

Ma said the people of Hong Kong have complained that "Disneyland is small."

 

He said no one will disagree it needs to expanded and that the government should inject funds in that event.

 

The park belongs to the people of Hong Kong as the government holds a 57 percent stake, Ma said. The government has invested HK$25 billion.

 

"I think nobody would like to see our stake being diluted, Ma said, adding he remained confident lawmakers will approve additional financing.

 

Ma also attempted to defend the scale of the theme park at the beginning.

 

"If I were to open a restaurant, I wouldn't start by having 100,000 square meters right away, as I wouldn't know how business would be like in the beginning."

 

Ma said he is trying to view the development of the theme park from an objective perspective, noting that he was not a party to the original decision to build Hong Kong Disneyland.

 

"Allan Zeman [Ocean Park chairman] once said what we show visitors are real animals, while what Disneyland shows are only cartoon characters. We need people to dress up as those characters, and hiring cost is an issue," Ma said.

 

He added that on average visitors stay just three days in Hong Kong, with one day usually spent at Disneyland, unlike visitors to California, where people stay about a week, spending three days in Disneyland.

 

"You can only blame the government if it does not have any plan for further development, but that is not the case," Ma said.

 

Meanwhile, Ma said he hopes Ngong Ping 360 cable car rides will be ready by Christmas. "I have confidence in MTR management, they have never let the people of Hong Kong down."

 

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