Cut deficit, create bold budget moves – Paul Chan's mission impossible?
Hong Kong's finance chief is expected to deliver his budget speech on February 26 and is under mounting pressure to balance the books. The Post looks at the dilemmas involved and the political will required to address funding challenges in a two-part series. Read part 1 here .
The message to a group of Hong Kong ministers gathered in Shenzhen on a recent Sunday was clear and, coming from Beijing's point man on city affairs, could be viewed as hailing from the country's president himself: be bolder, take action.
Xia Baolong, director of the Hong Kong and Macau Affairs Office, met finance chief Paul Chan Mo-po and seven other ministers to hear their plans on rebooting the city's sluggish economy and development, just weeks before Chan would unveil the size of the government's deficit for the current financial year in his budget address on February 26. Xia told the senior officials to abide by the spirit of President Xi Jinping's directions issued during the third plenum of the Communist Party – 'to be bold in reform, dare to break new ground and innovate continuously'.
No 2 city official Eric Chan Kwok-ki revealed later that Xia was 'very, very concerned about Hong Kong' and hoped the city could be further integrated into national development strategies.
Paul Chan previously pledged to focus on curbing growth in recurring expenses and prioritise public works to balance the city's books as he grappled with a deficit projected to reach just under HK$100 billion (US$12.8 billion) for the 2024-25 financial year. The figure was double Chan's original forecast and marked three consecutive years of operating losses.
Many people saw Xia's directives as an urgent reminder for the Hong Kong administration to quickly roll out bold innovations to address the deficit and push forward long-term development.
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