Govt Finances 'still Sound' Despite Relief Measures

Officials have played down fears anti-pandemic measures would drain public coffers, insisting the government's financial position is stable.

With the administration unveiling on Wednesday a HK$137.5 billion relief package to help workers and businesses weather the storm, Financial Secretary Paul Chan said Hong Kong's fiscal reserves will go down by about 20 percent, from HK$1.1 trillion to HK$900 billion.

Along with the first round of the anti-epidemic fund to the tune of HK$30 billion and the measures announced in the latest budget, all that will cost Hong Kong close to HK$290 billion, or 10 percent of the city's GDP.

The budget deficit for this financial year will also go up to HK$276.6 billion.

But Chan sought to calm nerves, pointing to the fiscal reserves that still amount to up to 15 months of the government's expenses.

Liberal Party chairman Tommy Cheung echoed that view.

"Not if you see the rest of the world, having a huge deficit like in the US, rely on printing money to save their neck, and still they do it," Cheung said.

"This is basically the right time for Hong Kong to spend the reserves that we have... All in all, this is about probably 20, 30 percent of our reserves, of what we have, so I think we are more than able to manage it."

Lawmakers are expected to begin scrutinising the HK$137.5 billion package next week, after the Easter holiday.