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1. Leung accused of car cover-up

2. Judge jails ICAC officer who made threats to witness

3. Blasting may have spread the outbreak on estate

4. We handled it badly, admits disease expert

5. Infected with a crisis of confidence in HK

6. Experts tally the cost of mainland's policy of silence

1. Leung accused of car cover-up
JIMMY CHEUNG, SCMP 7 April 2003

Hong Kong's financial secretary has been accused of a "cover-up" in the car-purchase scandal after a key letter in which he offered to resign was disclosed ahead of a final showdown in the Legislative Council this week.

Opposition lawmakers said Antony Leung Kam-chung had confessed he had flouted the code for ministers in his letter to the Chief Executive on March 10, but he insisted he had just been negligent when speaking in public on the same day.

The revelation has angered Democrats chairman Yeung Sum, who said Mr Leung and Chief Executive Tung Chee-hwa had not been frank in explaining the details from the beginning. He said they had initially only told the media that it was negligence rather than a breach of the ministerial code.

The affair will return to the spotlight as the financial secretary has been asked to appear again before the Legco constitutional affairs panel tomorrow to explain why he bought a new Lexus ahead of imposing a hefty rise on motor vehicle taxes in the budget.

On Wednesday, the Democratic Party will move a resolution seeking to establish a select committee which has the power to summon officials for evidence and open up confidential government documents for investigations.

The finance chief has insisted his action was merely an oversight. He later donated $380,000 to charity, twice the amount of tax owed to the Treasury.

He claimed he had sent his resignation letter to Mr Tung on March 10, a day after the scandal made headlines. Five days later, the chief executive announced the resignation had been rejected but censured Mr Leung for his gross negligence.

The scandal took a new twist over the weekend after the government bowed to pressure and disclosed the contents of the resignation letter.

According to the letter, Mr Leung confessed to the chief executive that he was not "in full compliance" with the ministerial code, which says officials should avoid putting themselves in a position which might arouse suspicion of dishonesty or conflict of interest.

He also said he accepted the responsibility for his mistake and believed resignation would be the proper action to take.

Dr Yeung said: "It gives the impression that there is something to hide."

2. Judge jails ICAC officer who made threats to witness
MAGDALEN CHOW, 7 April 2003

An anti-graft officer was jailed for nine months yesterday for lying in a fraud trial to conceal the fact that he had threatened a suspect to co-operate with a probe by the Independent Commission Against Corruption (ICAC).

Deputy Judge Andrew Ma Hon-cheung told Lau Wai-tim, an assistant ICAC investigator, that a deterrent sentence was called for due to the serious nature of the offence.

Lau, 38, was found guilty of perjury in the District Court. He and fellow assistant investigator Chung Wai-man, 33, were cleared of a charge of intending to pervert the course of justice. Mr Chung was only charged with the latter.

Judge Ma found that the two officers had induced and threatened Hung Hin-shun, 49, when interviewing him at his Fanling home on October 14, 1999.

Mr Hung, who was charged with conspiracy to defraud but was acquitted in September 2001 in the District Court, secretly taped part of the 30-minute conversation. The tape revealed that the two officers pressured and misled him to disclose information about a corruption complaint over a housing project. However, Judge Ma said he had to clear the two officers of the perversion of justice charge as the prosecution had failed to prove that in threatening Mr Hung they intended to prejudice his fraud trial. In Mr Hung's fraud trial in September 2001, Lau had denied having a conversation with Mr Hung at his home.

Judge Ma said Lau had deliberately lied to conceal his "grossly improper act". "It is very sad for this court to have found the defendant, being a law enforcement agent and officer in charge of the case, deliberately lied ... apparently to conceal his own improper act," the judge said.

Barrister Paul Loughran said Lau, who joined the ICAC in 1991, was driven to the crime because he was too keen to try to impress his superior.

He urged the judge to take into account that Lau, who formerly worked as an immigration officer and as a policeman, had not derived any direct personal gain.

The lawyer said there were also no ICAC guidelines on how junior officers should handle witnesses when inviting them for interview.

In an official reply last night, an ICAC spokeswoman said the anti-graft body would consider reinstating the acquitted Mr Chung. "The ICAC attaches great importance to staff professionalism and conduct, and regularly reviews its work procedures and internal guidelines with a view to maintain a high standard," she said.

3. Blasting may have spread the outbreak on estate
ELLA LEE and CHEUNG CHI-FAI, SCMP 7 April 2003

Blasting work in Ngau Tau Kok could have blown infected particles from a building site to nearby Amoy Gardens and spread the atypical pneumonia outbreak there, medical experts say.

An investigation team, comprising health officials and microbiologists, is racing against time to determine why the virus spread so quickly at Amoy Gardens where at least 278 residents have contracted severe acute respiratory syndrome (Sars).

Concern over the rapid rate of infection at the estate was a key factor in the World Health Organisation (WHO) decision advising travellers not to visit Hong Kong.

The team is studying if an infected worker at a Housing Society construction site opposite Amoy Gardens, was the source of the outbreak. The Department of Health confirmed that the man developed Sars on March 25 and was admitted to Princess Margaret Hospital four days later.

The project's contractor, Hsin Chong Construction, said last night that work at the site would be stopped until April 10.

The 26-storey building, which will house a home for the elderly, reportedly has one temporary toilet on every three to six floors, for 200 workers. Medical experts believe the infected worker could have urinated on the floor and contaminated particles may have been blown to Amoy Gardens.

The construction site is 20 to 30 metres away from Block E.

"On one floor, there was smell of urine. Vibration caused by the blasting work on a nearby slope might have helped blow the particles across to Block E," a source closed to the investigation said.

But the source also said there were doubts: "Block F of Amoy Gardens is also near the construction site. Why was there no outbreak in Block F? Why were no other site workers infected?"

Another theory being examined is that the building's sewage system could have become contaminated by infected human waste.

"The virus could have been carried by flushing water through the drains and contaminated units on different floors," the source said.

But again, some questions remain unanswered. "If only one duct was contaminated, we then have to answer why flats [on the same floor] of Block E got contaminated at the same time," the source said.

4. We handled it badly, admits disease expert
LEU SIEW YING in Foshan, SCMP 7 April 2003

A medical official yesterday apologised for China's failure to give the public more information about the outbreak of severe acute respiratory syndrome (Sars).

Li Liming, director of the Chinese Centre for Disease Control, admitted the mainland could have done better. The unexpected acknowledgment follows days of international criticism over the way China has handled the crisis.

Mr Li said: "Today, we apologise to everyone. Our medical departments and our mass media suffered poor co-ordination. We weren't able to muster our forces in helping to provide everyone with scientific publicity and allowing the masses to get hold of this sort of knowledge."

Still, co-ordination with the media remained an issue: his apology came at a news conference to which foreign news organisations were not invited.

Yesterday, World Health Organisation (WHO) experts in Guangdong said they were investigating the possibility that Sars could be transmitted even when there is no actual contact between patients.

WHO spokesman Chris Powell said the first victim in Foshan, Guangdong, went on to infect four other people but not grown-up children in his household.

Mr Powell said: "It is interesting to know that in a lot of cases there were transmissions within the community and families. It would be interesting to know why the four grown-up children did not get infected.

"There are five cases among the 24 cases in this part of the province where there was no actual contact and no trace of onward transmission so this is a real mystery."

He said it was "far too early to say" if the virus was airborne.

Foshan has had only 24 cases, with two deaths. Mr Powell said the low incidence was due to extensive disinfection measures and a public health campaign. As early as February 15, the city government distributed pamphlets telling medical workers and families how to protect themselves.

Earlier yesterday, Mr Powell said data presented by the Guangdong Centre for Disease Control showed that the "epidemic is coming under control".

The number of "community" cases in Guangdong rose from 12 to 505 at the end of February, falling to 183 at the end of March.

The community cases were compiled to differentiate infection among health workers who were responsible for the early spread of the disease, Mr Powell said.

The WHO was yesterday allowed to go into the offices of Guangdong's Centre for Disease Control and search computers.

It said yesterday it was still too early to say that Sars and the Guangdong illness were the same thing - a change of heart from previous deductions.

Mr Powell said: "The thing that has turned up consistently in Chinese findings is chlamydia.

"It is not two viruses at work but one virus acting with something else and in China that something else is chlamydia."

5. Infected with a crisis of confidence in HK
CHRIS YEUNG, SCMP 7 April 2003

Almost four weeks after more than 10 medical staff at the Prince of Wales Hospital reported symptoms of respiratory infections, Hong Kong remains gripped by fear as the mysterious atypical pneumonia outbreak takes its toll.

Schools are closed until at least April 22, business operations have been disrupted and tourists have postponed trips. Many people in Hong Kong wear face masks in offices and in public places.

In bustling central Kowloon, a multi-story residential block of Amoy Gardens has been emptied for investigators to try to track down the virus that afflicted more than 200 residents.

Fear turned to panic on Tuesday when a hoax online report said Hong Kong would be declared an infected port.

The hoax report sparked frantic phone calls and text messages. Housewives snapped up food and other essentials at supermarkets. Some panic-stricken residents consulted banks about switching their Hong Kong dollar savings to foreign currency.

Although the government denied the rumour, the intensity of fear and panic underlined the erosion of public confidence in the ability of the special administrative region's (SAR) leaders to tackle the health challenge. The key questions left unanswered are: what happened and when will it be over?

The medical experts say the outbreak, dubbed severe acute respiratory syndrome (Sars), can be traced back to a case in a Guangdong city in November.

A fortune teller, perhaps in jest, linked it with the picking of an inauspicious stick by a senior Hong Kong minister. This came at the beginning of the Year of the Goat during an annual ritual at a temple in Sha Tin - where the Prince of Wales Hospital is located.

And, cynics say, Hong Kong was doomed when Tung Chee-hwa was anointed as the chief executive.

However, wisdom from hindsight suggests the truth probably lies with a blend of an under-reported outbreak in southern China plus bad luck, misjudgment and mishandling by SAR officials.

Officials have been criticised for failure to take decisive and prompt measures to contain the outbreak. A medical professor at the Chinese University, Dr Leung Ping-chung, lambasted government reaction to the crisis as "shamefully slow".

Lo Wing-lok, who represents the medical constituency in the Legislative Council, said all parties had underestimated the severity of the outbreak in Guangdong.

Referring to the outbreak at Prince of Wales Hospital, he said: "Everyone knows it's going to be catastrophic from day one. They're dealing with an unknown disease. Superficially, there wasn't a lot of thought about the situation outside the hospital.

"With hindsight, we may always ask whether hospital visits should be restricted, for instance."

Dr Lo maintains the crisis exposed two structural problems in the SAR. First, he said under the present structure of a powerful Hospital Authority and a weak Department of Health, the issue had been dealt with from a hospital's perspective at the beginning.

"The problem now does not solely lie with a hospital. The bigger problem lies with the community."

Second, the crisis reflected a lack of political sensitivity and leadership in the Tung cabinet.

"Doctors, on one hand, take a rational approach. On the other hand, they want to assert authority. The approach of [Secretary for Health and Welfare] Dr Yeoh [Eng-kiong] goes like this: `I know best.'

"Under a crisis situation, the lack of political training and experience has brought about a lot of problems. The roles of Dr Yeoh as a doctor and as an official are confused," he said.

At times of a crisis, Dr Lo said Mr Tung should show leadership. "He should appear more often and pay more visits. But he has also acted as a technocrat. He spoke too much on the details. There should be a better division of work," he said.

The fierce criticism intensified with a sudden reversal in the government's stand over the suspension of student classes and isolation arrangements for Amoy Gardens' residents.

A source close to the government admitted there was a lack of vigilance within the senior echelon over the outbreak in Guangdong, around the spring festival.

A stronger sense of crisis emerged only on Friday of last week when signs of the outbreak at community level prompted the urgent implementation of measures, including quarantine provisions for Amoy Gardens.

"No one at Exco wore a mask at a meeting last week," the source said. "This Tuesday, even Mr Tung wore one at the meeting."

The Sars crisis unfolded on March 10 when more than 10 medical staff in Ward No 8A at Prince of Wales Hospital showed signs of pneumonia infection and fever.

The report was carried the next day in some Chinese-language newspapers. But the headlines were dominated by remarks made by Mr Tung and Financial Secretary Antony Leung Kam-chung over Mr Leung's car-gate affair.

On the same day, the Department of Health issued this statement: "In response to media inquiries, the department `is concerned' about the case of staff at Prince of Wales Hospital in Sha Tin. The department is liaising closely with the Hospital Authority and investigating the case. Laboratory tests are being conducted." it said.

After visiting the hospital on March 14, Mr Tung said: "The SAR government attached a high degree of importance to the issue. We are facing a relatively severe challenge. The most important thing is to prevent the spread of the disease."

On the same day, Dr Yeoh said: "We are not talking about any outbreaks in the community."

On March 17, Professor Sydney Chung Sheung-chi, of the Chinese University's medical school, held a hastily-convened media briefing at the Sha Tin hospital. Professor Chung, tearfully revealed the hospital was not the only source of the outbreak and that cases had originated in the community. "A crisis is out there," he said.

The next morning, Dr Yeoh gave the first detailed briefing to Exco about the atypical pneumonia attack. An Exco member, Tsang Yok-sing, recalled: "He [Dr Yeoh] was quite optimistic. The Amoy Gardens case had yet to emerge. He believed the peak of the outbreak was behind us."

But then came more worrying signs of a community outbreak, culminating with the rapid escalation of events in the past 10 days.

Mr Tsang, an educationist-turned-legislator who heads the Democratic Alliance for Betterment of Hong Kong, was named by Mr Tung to join a top-level government taskforce to deal with the Sars crisis.

The battle against Sars has included some controversial decisions.On March 25, there was the decision to continue school classes.

This was reversed two days later. Then there was the issuing of an isolation order for residents of the Amoy Gardens block on Monday morning, and a subsequent evacuation of them to holiday camps on Tuesday.

The government source said: "It speaks volumes about the typical way officials respond to a crisis. Without a grasp of information and evidence, they tend to take a very cautious, wait-and-see attitude. They dare not make drastic decisions. They are worried about the lack of public support for their decisions. A weak government finds it extremely difficult making tough decisions."

The source said the fact the cabinet was sharply divided over some controversial issues further delayed decisions. "Even the experts held different opinions. For the minister, he can only make the best recommendation.

"The decision has to be made by the chief executive.

"Mr Tung is a nice person. He always wants to listen to all views. Ultimately, it takes more time for decision," he said.

Mr Tsang rejected the criticism. "With hindsight, I honestly cannot think of any decision that we made belatedly.

"To be fair, the overall standard of crisis management is not low.

"Taking an outsider's perspective, I'm convinced the World Health Organisation will commend our efforts."

He said he remained convinced that the government view, that there was no evidence of airborne transmission, was correct.

Mr Tsang said the decision not to close schools on March 25 was adopted "almost unanimously" after examining all factors, including risk assessment.

"We had not only discussed the issue of school classes, but the whole strategy at a meeting. We agreed there was no need to adopt drastic measures. More importantly, we agreed on the need to educate people about the importance of public hygiene."

But a change of mind emerged in the following two days when alarming figures pointed to a community outbreak. On March 25, four residents at a Ma On Shan residential building were confirmed as being infected. More schools decided to suspend classes.

Shortly after five families in Amoy Gardens were hospitalised with the Sars infection, Mr Tsang said there was a consensus that something needed to be done.

Mr Tsang said: "On one hand, there was an outcry from parents for school closure. On the other hand, the government feared there was a real threat at the community level. There was a heated debate. Some said a u-turn would be severely challenged.

"But if we'd agreed there were potential virus carriers in the community, we must protect our children. [Secretary for Education and Manpower] Arthur Li Kwok-cheung maintained classes must be suspended."

A week-long suspension of schools and quarantine arrangements for about 1,000 people who had had close contact with Sars patients were among a set of five measures announced on March 27. Dr Li later announced that the suspension of classes would be extended until at least April 22.

As the number of cases at Amoy Gardens climbed, it was decided last Sunday that the isolation order would be issued early Monday. Following more evidence of transmission through facilities at the complex, the government rehoused residents from Block E on Tuesday to allow a thorough investigation of the mysterious outbreak.

The total number of infected people in Hong Kong stood at 761 yesterday. The death toll is 17.

Significantly, the number of new cases started falling on Wednesday and Dr Yeoh said the peak of the outbreak had passed.

Nevertheless, the adverse impacts on the economy have begun to surface. Most analysts have revised their forecasts down for economic growth.

Mr Tsang said: "I believe anyone who has gone through the decision-making process like me would feel confident about the situation.

"From day one, the government knows what it is doing. There is no panic.

"The weakest link perhaps is our communication skills. You know the problem of Mr Tung. The more he speaks, the less the public trust in the government.

"Both Dr Yeoh and Dr Margaret Chan Fung Fu-chun [director of health] know the issue from A to Z.

"But perhaps Dr Yeoh gave so many details that the public didn't quite get the key messages," Mr Tsang said.

"My advice has been simple. The government just needs to tell the public everything it knows.''

Mr Tsang said the government might be rightly criticised for the lack of vigilance in the early stages of the outbreak. "What it has done, particularly Dr Yeoh and his colleagues, has more than made up the lost ground."

There has been a marked change in public sentiment towards unity and harmony. Catholic leader Bishop Joseph Zen Ze-kiun has called for community efforts to overcome the crisis.

But the discontent has not been quelled. A local deputy to the National People's Congress said he was disappointed with the messy way the government had handled the crisis. "I'm sick of this government," he said.

6. Experts tally the cost of mainland's policy of silence
ALLEN T. CHENG in Beijing, SCMP 7 April 2003

Four years ago, before the Aids epidemic in Henan province made international headlines, an overseas Chinese journalist bumped into a vice-minister of Public Security at a banquet hosted by a Hong Kong tycoon at a prominent Beijing shark's fin restaurant.

A bit tipsy after drinking more than his fair share of Hennessy XO, the deputy minister began telling stories of his travails. One was of his then recent visit to a little village in Henan to check out the "blood stations" where farmers lay like livestock on the floor, drugged for hours and days, selling their blood so their family could make ends meet.

"It was terrible what I saw," said the senior official. "I had to go to Henan myself to check out the rumours. And yes, I saw hundreds of these dirty, little blood stations where people sold blood, hundreds of them using the same needles. No wonder so many got Aids."

Sobering up a bit, and turning to the journalist sitting besides him, the official said sternly: "Now for the sake of the motherland and the love of the great Communist Party, don't you dare write about this, OK?"

That journalist kept his promise and never did, but somehow the rumours got out and crept into the international media. By 2001, two years after the dinner, headlines around the world were so scathing that the mainland authorities had to take action to shut down the blood sale operations.

But that was then, and the disease was Aids, which required the exchange of body fluids in order for transmission to take place. The ongoing crisis involving the severe acute respiratory syndrome (Sars) is an altogether different matter.

With its transmission method undetermined, Sars has mushroomed from a single case in southern Guangdong in November to more than 2,200 cases around the world. This time, China was forced to take quick action and admit that it had a crisis on its hands. That is because the World Health Organisation (WHO) was knocking on the gates screaming for a thorough investigation, lest the epidemic spread even more.

The Sars crisis and the previous Aids scandal have one major similarity: In both cases the Chinese government and local authorities were loath to admit that they had a crisis, resisted international queries, and even accused critics of sensationalism.

Unlike the blood-station Aids crisis that was contained to just a few inland provinces, Sars has brought the global business community into the debate. Regional travel has come to a virtual standstill as the WHO issued an alert this week calling for travellers to avoid Hong Kong or Guangdong.

Dozens of conferences and other events scheduled for Hong Kong, Beijing, Shanghai, as well as regionally, have been cancelled. The severity of Sars has become only too apparent.

Global investment banks, which typically are extremely polite to the mandarins on the mainland, have begun accusing officials of mishandling the crisis and causing a drop in investor confidence.

On Wednesday, Morgan Stanley Dean Witter revised downwards its 2003 growth forecast for the entire region, including the mainland, and blasted the mainland authorities for not being more forthright. Yesterday, Citibank's Salomon Smith Barney followed suit, revising its gross domestic product (GDP) estimate for the mainland downwards 0.3 percentage points to 7.3 per cent, citing a dramatic slowdown in travel and the services sector in general. "I believe the main problem isn't a growth problem," said Huang Yiping, China economist at Salomon Smith Barney. "The service sector will recover. The impact is in two areas.

"One is whether foreign direct investment should be diversified. Everyone knows China is a good market, but the transparency is a real issue. This incident only serves as a powerful reinforcement of this image of China not being transparent.

"Another has a lot to do with how they deal with problems. In the past if a bunch of people died in a mine, you kept it a secret, that's fine even if local people aren't happy. But this is a contagious issue. You keep it a secret, but it spreads worldwide. This is a very traditional way of handling a crisis, but it doesn't suit the situation. To this day, the government doesn't admit that the disease began in China."

Andy Xie of Morgan Stanley Dean Witter said Sars was the most serious challenge for China and the region since the Asian Crisis of 1998. "Given China's size, how it handles this crisis will likely determine its development in the region or beyond," Mr Xie wrote in a report. "The new leadership in China is facing its first serious test. Transparency and determined responses are necessary to sustain foreign investors' trust in China."

Professor Wang Guiguo, a top China law expert at City University of Hong Kong, said the way the central authorities handled the issue reflected their narrow view of globalisation. They saw globalisa- tion only in terms of economics, he said.

"In the past China only saw globalisation in terms of economics, but we can see it goes way beyond economics," said Mr. Wang.

"Globalisation means you must become more open and share more information within the society and with the world. Perhaps this crisis will force China to see globalisation beyond just a narrow economic angle."

Mainland sensitivities to criticism became only too apparent when local analysts, other than foreigners based in China, refused to comment on questions about the government's handling of the crises. Even a top Hong Kong-based China economist refused to comment. "I'm not going to revise our forecasts," he said. "This is a very sensitive topic. I'm not touching it."

Ying Chan, the director of the Hong Kong University's Journalism and Media Studies Centre, said she heard from Hong Kong doctors that officials in Guangdong actually did a better job in containing the epidemic.

"One of Hong Kong's top doctors told me that Guangdong officials are increasingly doing a better job, but that they and Beijing are not publicising it," said Ms Chan. "This is a public relations fiasco. They might be doing a good job, but they're not publicising it. They can learn a lot from Hong Kong, which has been quite responsive to media queries.

"What China has to learn is that transparency actually would ease the panic. Transparency is part of crisis management."

Mainland media have begun reporting about the crisis in recent weeks. Earlier this week Premier Wen Jiabao and President Hu Jintao announced to the nation that they consider Sars a serious issue.

After repeated queries from the WHO, Health Minister Zhang Wenkang only this week allowed its team of international health experts to go to Guangdong to do further tests.

Perhaps the authorities can learn from Professor Chan's advice.

She said: "A good part of crisis management is information management. It doesn't mean you don't give information, but you manage it - on a global scale.

"When you talk, you're not just talking to your citizens, you're talking to the world."