Hong Kong budget: with years of deficits looming, city must find new revenue streams and areas for economic growth, experts warn
- Economists warn city is running structural deficit earlier than had been expected
- Next year’s deficit will hit all-time high of HK$139.1 billion because of one-off relief measures
The Hong Kong government’s decision to go into the red this year – and for the next five – has sparked calls from financial experts for it to come up with a more comprehensive strategy to seek other revenue streams and identify new areas of economic growth.
Some warned that the city was facing a structural deficit a year earlier than government advisers had predicted, despite denials from the finance chief on Wednesday.
Economists in the government’s Working Group on Long-Term Fiscal Planning warned six years ago that there could be a structural deficit by 2021, as increases in expenditure exceeded revenue growth as a result of the ageing population.
The administration predicted there would be deficits over the next five years, ranging from HK$7.4 billion to HK$17 billion. Next year’s would also hit an all-time high – of HK$139.1 billion – because of one-off relief measures.
