Chan upbeat on recovery despite deficit

Wallis Wang

The economy has been recovering since early this year although Hong Kong is expected to record a high financial deficit due to lower land sales, Financial Secretary Paul Chan Mo-po said.

But he said Hong Kong's financial situation over the long term remains healthy and that an abundance of caution remains the official mantra.

He said yesterday the budget this year was based on estimated land sales of HK$85 billion but that only HK$11 billion has been chalked up so far.

"The deficit this year may be higher than expectations But the SAR still has a healthy financial and economic system in the long term," he said.

The government will review various factors "in a pragmatic manner" in deciding whether to ease back on some of the "harsh measures" in the property market.

He said the local economy had been recovering well since the border reopening early this year and the SAR will also host more large-scale events, including the Global Financial Leaders' Investment Summit next month, which is expected to bring in a lot of business travelers.

"The number of tourists has resumed to 70 to 80 percent of prepandemic levels. Retail sales has also recovered to 90 percent of the pre-Covid number," Chan said.

"The most important thing is working together to boost the economic recovery in Hong Kong and bring prosperity back to the market so that people will feel the SAR has interesting events and good food, is safe, and they can make money here."

Chan, who visited France, Britain and Germany recently, said the European business sector had shown great interest in the SAR as he touted the advantages the city has under "one country, two systems" and eased their concerns about rule of law.

"[European countries] wish to expand business in the mainland, the Greater Bay Area and even the Asian market through Hong Kong," he said.

"Some western media reports on Hong Kong were biased. Companies that recently visited the SAR also agreed with me, saying 'we have been to Hong Kong recently and the market is really prosperous.'"

The Office for Attracting Strategic Enterprises has so far contacted 200 global companies and some 30 of them have agreed to set up offices here, Chan said, adding more enterprises will follow the trend.

Asked whether the US sanctions against SAR and mainland officials will deter overseas companies from coming, Chan said the business sector pays more attention to economic benefits and development.

He said western countries, including the United States, are greatly invested in Hong Kong and are "tied to the SAR," adding they should develop with Hong Kong together.