Hong Kong to Revitalize Economy

Hong Kong to Revitalize Economy

(ReliableNews.org) – June of 2019 saw the beginnings of a long period of unrest and protests over an extradition law introduced into Hong Kong’s legislative body. After months of violent protests, the territory is licking the wounds caused by people being out of work and the destruction of property. Although the months-long protests in Hong Kong have largely died out, the massive city has yet to fully recover.

The city didn’t get a break with the coronavirus infecting 81 citizens, killing 2, and impacting markets across the world, which hurts the territory’s trade. But things are looking up now.

Investments in the Economy

Now that things have mostly settled down, the city’s infrastructure and financial situation are being attended to with a $120 billion Hong Kong Dollar (HKD), or just over $15 million USD, relief package. Hong Kong has decided on a number of measures to help boost its economic situation with a new stimulus plan.

The biggest headline is a stipend of $10,000 HKD equivalent to $1,280 USD, being given out to permanent residents over the age of 18. That equates to around seven million adults.

According to Paul Chan, the financial secretary, this one-time payment is to help boost consumption and reduce the financial burden the Hong Kong citizens may be experiencing.

Additionally, the program includes:

  • Reducing 2019-2020 salary and personal assessment taxes by 100%, up to a total of $20,000 HKD
  • One month of free rent for low-income tenants living in public units
  • One extra month of CSSA payment, Disability Allowance, Old Age Allowance or Old Age Living Allowance, or
  • $30 million HKD towards Labour Department employment programs
  • $2.5 billion HKD to Employees Retraining Board
  • Access to a concessionary low-interest loan for up to $2 million HKD to be repaid for up to three years
  • Business registration fees waived for 2020-2021 and registration fees for annual company returns for two years
  • Continuation of other relief programs announced last year like reducing electrical and water charges, recycling subsidies, and temporarily halving rental of government properties

In total, Hong Kong’s budget deficit is expected to rise to about $18 billion HKD by 2021, which would set a new record. They’re also experiencing side effects of the US trade war as China attempts to maintain economic and governmental control over the territory.

While deficit spending isn’t ideal for any government, it’s a step that Hong Kong thinks is necessary to get back on its feet after months of instability.

Copyright 2020, ReliableNews.org