Transport Minister Mable Chan on Sunday said road capacity and the need to prioritise public transport were factors in the government opting to limit the number of ride-hailing licences.

Earlier this month, the government unveiled its planned regulatory framework for ride-hailing. It included requiring platforms, vehicles, and drivers to have renewable licences or permits.

"We think there needs to be a limit on the total number of licences. Currently, around 90 per cent of people use public transport to travel. As for point-to-point services, its patronage and efficiency is not that high," Chan said on a radio programme.

"We also need to include factors such as road capacity and give priority to public transport".

Chan said regulation would lead to healthy competition and prevent drivers from drastically lowering fares to attract customers. She said unfettered competition would reduce drivers' salaries and deter new drivers from entering the industry.

The minister also said she hoped ride-hailing services and the taxi trade would complement each other, with the former acting as a kind of auxiliary service.