HONG KONG -- Ocean Park, Hong Kong's signature amusement park, could go out of business by the end of June, as the novel coronavirus pandemic has brought the city's tourism sector to a standstill, the park's chairman said on Monday.
A government-proposed emergency aid package of 5.4 billion Hong Kong dollars ($696.5 million) will be scrutinized in the legislature this week, determining whether the 43-year-old theme park -- home of the city's pandas, various marine life and amusement rides -- will cease to operate.
The bailout would replace a previous plan to inject HK$10.64 billion into the government-owned amusement park that would aim to transform it into an integrated resort with 20 new attractions by 2027 in an effort to sharpen its competitiveness in the Asia-Pacific region.
Edward Yau Tang-wah, secretary for Commerce and Economic Development, said on Monday that officials had changed their plans because of the COVID-19 pandemic, which has prompted the government to rethink the allocation of public funds.
"The challenges faced by Ocean Park are unprecedented," Yau said. "Without the aid, the park will not be able to survive."
Yau said that HK$3 billion of the aid would be used to pay off the park's commercial debt, while the rest of it would ensure that it could sustain normal operations for the next 12 months while buying time for it to devise a better strategic plan.
Ocean Park's Chief Executive Officer Matthias Li Sing-chung is set to retire in July. Last August, the park activated a global executive search to find a successor.
Ocean Park, along with Hong Kong Disneyland, has been closed since late January due to social distancing measures that aim to contain the COVID-19 outbreak.
Leo Kung Lin-cheng, chairman of Ocean Park's board, said the park has so far spent HK$700 million to maintain limited operations during the closure. Its 2,000 employees have been asked to take unpaid leave.
Even before the pandemic, both amusement parks in Hong Kong had been struggling, as the monthslong anti-government protests took a toll on visitors and tourism. In their most recent fiscal years, Ocean Park and Hong Kong Disneyland recorded net losses of HK$557.3 million and HK$105 million, respectively.
With locally transmitted coronavirus cases at zero for the past three weeks, government officials say the two theme parks are likely to reopen in the coming weeks. Yet, they will still face a tough operational environment, Yau said. In the first quarter of 2020, tourist arrivals in Hong Kong were down 81% from the same period a year earlier due to worldwide travel restrictions.
It is still unclear whether the bailout plan will win support from lawmakers across the political spectrum, as many have voiced skepticism.
"It is no different from kidnapping," said opposition lawmaker Claudia Mo, adding that the park's management should be held accountable for its widening losses in recent years.
Meanwhile, pro-establishment lawmaker Michael Tien said he would take into account the recruitment of the new chief executive when deciding on his vote. "We have to make sure that the park is self-sustainable in the long-run," he said.
Yiu Si-wing, a lawmaker who represents the tourism sector, told local media that the park's grand expansion plan will very likely be shelved because the new aid proposal is just half of the original plan. "Solving the urgent financial needs of Ocean Park is of utmost importance," he said.