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Hong Kong budget deficit ‘unavoidable’ for two years, finance chief Paul Chan says
- The city will be in the red in 2020-21, as well as this year, the senior official said on Saturday
- It is too early to say whether public spending will exceed income over the longer term, Chan adds
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Hong Kong will be in the red for two budgets in a row, the financial secretary said within days of predicting the city’s first fiscal shortfall for 15 years.
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Paul Chan Mo-po said on Saturday it was too early to say whether the deficits would persist in the longer term as he revealed the anti-government protests – estimated to have cost the city 2 percentage points in gross domestic product – were hitting the economy far harder than external factors.
Expressing concern over the impact of the Hong Kong Human Rights and Democracy Act, Chan said some top international universities were already hesitant to work with local institutions after the legislation that could pave the way for diplomatic action and economic sanctions against the city’s government was passed last month in the United States.
It comes with the city still reeling from often violent protests triggered in June by the now-withdrawn extradition bill.
The decline in business performance has prompted the government to roll out more than HK$25 billion (US$3.2 billion) worth of relief measures, with the latest round announced on Wednesday.
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