27 Feb 2020
Around 120 billion Hong Kong dollars-worth of measurements are to be invested by the Hong Kong government to help control the coronavirus outbreak.
Both the Hong Kong and the global economy struggled as consequence of the emerging coronavirus.
Hong Kong’s Financial Secretary Paul Chan said, “Since January 2020, Hong Kong has come under the threat posed by the novel coronavirus outbreak, which further dealt a blow to the economy. We must take decisive measures to tackle the situation.”
The government will be providing a number of benefits to constrain the virus from being spread around the country and abroad.
Speaking during the budget, Chan explained that this will lead to “an all-time high” fiscal deficit of 139.1 billion Hong Kong dollars, that will amount to roughly 4.8% of Hong Kong’s GDP.
He added that the government will be offering low-interest loans for small- and medium-sized enterprises as well as reducing profit taxes by 100% with a limit of $20,000.
The government will also be granting 10,000 Hong Kong dollars as payout to residents aged over 18.
“The deficits are mainly caused by the fact that government revenue cannot keep up with drastic increases in government expenditure, especially recurrent expenditure,” said Chan.
The Economist Corporate Network’s director Janet Pau explained, “Mainland tourist arrivals have been decimated by months and months of social unrest, and we will have to see if there’s going to be a pickup after this kind of twin crises.”