Environment & Health Hong Kong

Budget 2018: Environmental group says gov’t green bonds could lead to more ‘white elephant’ projects

Environmental group Green Sense has expressed concern that the capital allocated by the government for “green public works” will give rise to more “white elephant” projects.

During Wednesday’s budget speech, finance chief Paul Chan announced that a green bond issuance programme – with a borrowing ceiling of HK$100 billion – will be launched to promote green finance and fund the government’s green public works projects.

Paul Chan

Paul Chan. Photo: GovHK.

In a statement on Wednesday, Green Sense said the term “green public works projects” was too vague and that the public would not understand what it entails. It added that the government’s previous track record with such projects involved little supervision on the part of the legislature, and controversial projects such as the development of Wang Chau village and the reclamation of Siu Ho Wan caused environmental destruction.

White elephants refer to projects which are expensive, difficult to maintain or underused.

Sufficient surplus

Pro-democracy lawmaker Eddie Chu also said that he felt puzzled about the issuance of “green bonds,” as the government has a huge surplus and bonds were usually issued when there was a deficit. The government announced a HK$138 billion surplus on Wednesday.

“The government should not be borrowing money on its own — we have enough surplus for this purpose. We’re also concerned as to what on earth these ‘green infrastructure projects’ are.”

Eddie Chu

Eddie Chu. Photo: In-Media.

Paul Chan also unveiled a “one-for-one replacement” scheme to allow eligible private car owners to scrap an eligible private car and switch to an electric vehicle to enjoy a higher first registration tax concession of up to HK$250,000.

Green Sense said that, although the emissions of electric cars were lower than regular private vehicles, it is less energy-efficient compared to using public transport.

It said the government did not introduce measures to encourage car users to give up on driving, or control the growth of cars. It said their measures will have little impact on improving air quality or transport efficiency.

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Budget 2018: Environmental group says gov't green bonds could lead to more 'white elephant' projects