Hong Kong government will budget $15.5 billion in expenditure this year. Reporting from CNBC, Thursday (24/2/2020), the expenditure budget was allocated to leverage the economy to escape from Hong Kong recession that has occurred in the last two years.
“Hong Kong has experienced misery in the last two years,” said Hong Kong Finance Minister Paul Chan in his budget speech on Wednesday (23/2/2021).
“With the pandemic still happening, our economy will not come out of recession yet,” he explained.
The Hong Kong economy has come under pressure in the past six quarters after struggling with a series of crises.
This includes the trade war in 2018, as well as demonstrations that have lasted for months since 2019, as well as the pandemic in 2020.
In recent years, the government has increased spending to help businesses and households.
Hong Kong’s Budget Deficit Has Ever Touched the Highest Level of $ 33.2 Billion
In addition, the budget deficit had touched its highest level in history last March at around $ 33.2 billion.
Hong Kong’s budget deficit this year is set at $13.1 billion.
The 2021 budget, which began in April, includes a budget for the procurement of the Covid-19 vaccine of $1.1 billion.
In addition, a budget to support businesses of $1.2 billion and support to lift personal income taxes, as well as assistance in the form of shopping vouchers worth $645.
For information, Hong Kong’s economy contracted by 6.1 percent in 2020. The contraction is much deeper than in the previous year which was only 1.2 percent.
Chan also assessed that Hong Kong’s economy is expected to grow again positively this year. He said Hong Kong’s economy is projected to grow in the range of 3.5 percent to 5.5 percent this year, in addition to an average of 3.3 percent in the range of 2022 to 2025.
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