HK deficit hits $183b in nine months

Hong Kong's deficit for the first nine months of the current fiscal year stood at HK$183.2 billion after taking into account the HK$20 billion generated by the issuance of green bonds, a government spokesman said.

Expenditures for the nine-month period amounted to HK$593.3 billion and revenues HK$390.1 billion.

For the month of December alone, a surplus of HK$87.1 billion was recorded.

The spokesman explained the year-to-date deficit for the period was cumulative, saying some major revenue sources including salary and profit taxes are mostly received towards the end of the financial year.

The revised estimates for the current financial year will be published along with the 2023-24 fiscal budget.

PwC is expecting a government deficit of HK$109 billion for 2022-2023, the second highest in a decade.

PwC forecasts an overall government income of HK$681 billion and spending of HK$790 billion.

Deloitte is gloomier, projecting a government deficit of HK$170 million, about three times the HK$56.3 billion estimated at the beginning of the financial year.

The SAR's worst deficit was HK$232.5 billion in 2020.

Increased spending in pandemic control and consumption vouchers and less income from weakened land sales were blamed for the widened gap.

Hong Kong Institute of Certified Public Accountants believes the fiscal deficit could reach HK$113.9 billion mainly due to poorer land sales of the year.

The institute predicted land sales in year 2022-2023 to fall 46.9 percent to just HK$84.9 billion this financial year from HK$141.1 billion of 2021-2022, fuelled by the recent withdrawal of a large site in Stanley from tender.

Meanwhile, the total asset value of the Exchange Fund dropped to HK$4.01 trillion as of December, about HK$4.2 billion less than that of November.

Total deposits increased by 1.7 percent with Hong Kong dollar deposits rising 0.7 percent and yuan deposits in the SAR falling by 6.3 percent in December.