Unfeasible to end structural deficits by issuing bonds, says ex-finance chief

Former Financial Secretary John Tsang Chun-wah expressed concerns about the government's deteriorating financial situation and potential reliance on loans.

His comment came after the city planned to issue HK$120 billion of bonds in the coming fiscal year.

On his Facebook page today, Tsang said he is worried that the SAR government might need to rely on loans and run up in debts in the future.

The government has entered a period of structural deficit and needs to increase revenue through taxation and land sales, according to the former finance chief.

He also pointed out that the measures could cause a great deal of pain and might not even bring in enough income to make a dent in the deficit.

He fears the government could end up ending in debt hell and have the city's credit rating diminish in the long run.

Tsang stated that issuing bonds for infrastructure projects that provide long-term economic benefits is acceptable, but relying on loans for daily expenditures is not ideal.

He stressed that the government needs to review expenditures or else they will never end the structural deficit.

Tsang said when he was the financial minister, he was often criticized for being a miser and hoarding the reserves. He hoped citizens understood his decision now.