HK financial chief delivers budget proposals
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Hong Kong's financial chief John Tsang Wednesday proposed in a budget speech increasing housing assistance, injecting a large sum of money into an anti-drug fund and raising stamp duty rate on transactions of high-end properties.
Sporting a green-striped tie, the Financial Secretary delivered the budget proposals for the fiscal year 2010-2011 at a meeting of the Legislative Council.
Tsang said he expected the Hong Kong economy to grow by 4-5 percent in 2010, with the employment situation to further improve and the underlying inflation to be 1.5 percent.
"I am cautiously optimistic about Hong Kong's economic prospects for 2010," he said.
Tsang said the impact of the latest financial crisis on the local economy was much larger than that of the 1997-98 financial crisis but the Hong Kong economy improved in the second quarter of 2009 and contracted by only 2.7 percent for the full year.
There remained uncertainties in the external environment given that the labor markets in the developed economies have yet to improve, and it remains uncertain whether some of the economies can grow robustly after the effects of the stimulus measures subsided, he said.
Nevertheless, the strength of the mainland economy is expected to offset the fragile recovery of overseas markets, Tsang added.
Tsang said the exceptional measures put in place by Hong Kong Special Administrative Region (HKSAR) government should not and could not be sustained for long.
"Governments around the world are now making plans to exit from their exceptional measures. Some have already begun to progressively execute these plans. We should also prepare to adjust our exceptional measures at a suitable time," he said.
Tsang pledged to put in place measures to prevent asset bubbles in the local real estate market, including adjusting land supplies and raising the stamp duty rate on transactions of properties valued over 20 million HK dollars (2.56 million U.S. dollars) from 3.75 percent to 4.25 percent.
Tsang also pledged to increasing support for the maintenance of certain buildings, after the recent tumbling of an old building in Kowloon, Hong Kong, made headlines.
Tsang also proposed investing more in education, infrastructure and health care.
In a measure to boost anti-drug abuse efforts, the Financial Secretary also proposed injecting 3 billion HK dollars (384 million U.S. dollars) into the Beat Drugs Fund.
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