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MTR has kept Hong Kong moving in challenging times

CEO says that through protests and coronavirus, trains run against the odds

| Hong Kong

Hong Kong has long been known as one of the most vibrant and dynamic cities in the world. In recent months, however, it has been hit by a powerful double whammy which has affected business and shaken confidence.

Following months of social unrest stemming from wider political issues that led to violent attacks on the transport infrastructure, among other targets, Hong Kong was impacted by the COVID-19 epidemic starting early this year.

While the origin of these two storms has been far beyond our control, for MTR Corp., as the city's railway operator, this has been by far the most challenging period in our 40-year history. Our service is critical to the daily lives of millions of people in Hong Kong, and I am proud that our dedicated and professional staff have kept Hong Kong moving during these difficult times.

In our worldwide operations spanning nine cities, we carry an average of 12.8 million passenger journeys a day, including 5.6 million in Hong Kong in 2019. Whatever the near-term challenges, our high quality, environmentally sustainable railway services continue to be essential arteries for these cities and are critically important in the daily lives of our customers.

It is our duty to serve them and we are determined to stand steadfast with our customers and our staff to ride through the storms.

To provide some context on the latest situation, in January and February our Hong Kong railway patronage fell by 34% year on year as the coronavirus epidemic spread to our home city.

Cross-boundary and high-speed rail services to mainland China have been suspended, while domestic patronage has been affected by social distancing measures such as work-from-home arrangements and school closures. Tourist and local leisure travel has decreased significantly.

With less movement through the railway network, there are also impacts on tenants in our station shops and our shopping malls.

Beyond Hong Kong, the patronage of railway services that we operate in Beijing, Hangzhou, Shenzhen and Macao has all been affected and, as the coronavirus spreads around the world, we are seeing impacts to different extents on our international hubs in London, Stockholm, Melbourne and Sydney.

As a key transportation operator in Hong Kong, MTR Corp. is at the forefront of our city's defense against COVID-19. With a focus on keeping Hong Kong moving and in accordance with our safety-first principles, we immediately implemented extensive infection prevention measures.

In addition to the nanotechnology titanium oxide spray already applied in train compartments to reduce microorganism presence, we stepped up cleaning and disinfection in railway stations and train compartments as well as in our properties and work locations.

We also ensured the supply of sufficient hygiene protection supplies for our staff as we require all customer-facing staff members to wear a face mask and check their body temperature before each shift. The entire city is on high vigilance and it falls on us, as the city's mass transit operator, to hold the fort at our facilities, many of which interface with millions of users every day.

In addition, we announced relief measures to fight the epidemic alongside the community. These measures include ensuring that there is no fare increase this year for our passengers using Octopus, thus extending our fare freeze for a second consecutive year. We have given rental reductions to property tenants. We also donated 100,000 surgical masks to vulnerable members of the community.

We are glad to report that throughout the outbreak, our domestic train service has been maintained for everyone who needs it, and thanks to the vigilance of Hong Kong people and the city's effective containment measures, the confirmed COVID-19 infection rate of the population is one of the very lowest among major international cities around the world.

Similarly, in the previous storm last year when railway stations and light rail stops faced violent attacks and widespread vandalism, we strove to keep Hong Kong moving. We operated train services to the maximum extent possible. We kept Hong Kong moving against the odds.

However, our first and overriding principle is always to put safety first. That includes the safety of our passengers, the safety of our staff and the safety of railway facilities and infrastructure.

Despite the recent challenges we have faced, MTR's business remains sound. Our rail plus property business model, which integrates railway expansion with development above and around new stations, has proved to be financially sustainable for the long term.

We continue to expand our businesses around the world. In February, we commenced passenger service on the first section of the Shatin to Central Link, a major strategic railway project in Hong Kong. In 2019, we opened new lines or extended our rail services in Sydney, London, Hangzhou and Macao.

Since the opening of the first MTR line in 1979, we have weathered challenging times and seized many opportunities to achieve new heights. While there are considerable economic uncertainties ahead globally, we are determined to continue to stand steadfast alongside our customers and staff to ride through the challenges.

We will uphold our safety-first principle and keep MTR moving forward along with all the cities that we serve.

Dr. Jacob Kam is CEO of MTR Corporation, Hong Kong.

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