Financial Secretary Paul Chan warns of deficit as Hong Kong government earns less amid protest crisis but continues to boost relief spending
- Government originally estimated a surplus of HK$16.8 billion but the city has spent more and earned less during months of protests
- Chan points to reserve of more than HK$1.1 trillion and says ‘fiscal position is still sound’
Hong Kong’s finance minister has warned of a possible deficit this year because the government has increased spending on relief measures while earning less amid an economic downturn.
“For the financial year of 2019-20, which runs until March, there is a chance that a deficit will occur,” Chan told reporters ahead of a trip to Beijing, where he was expected to meet mainland Chinese finance officials.
He said the government originally anticipated a surplus of HK$16.8 billion (US$2.1 billion) for the current financial year, but the estimate could change because of new factors that had emerged in recent months.
The government now has a reserve of more than HK$1.1 trillion, meaning the fiscal position is still sound
These factors included less government earnings from stamp duties from relatively quiet stock and property markets, and less revenue from profits taxes in some trade sectors going through slumps or deficits.
