WHEN Sir Hamish Macleod stands up to present what will be his last Budget on Wednesday, Hong Kong's business community could be forgiven for saying: 'Isn't this where we came in?' It certainly looks like it. When Sir Hamish made one of his first major presentations to Legco as Financial Secretary in November 1991, his theme was inflation, and the evils of speculation in the property sector.
The business sector, faced with an increasingly competitive region, was burdened with rising rents, wages and other costs. It still is.
The inflation figure he reported then, for September 1991, was 11.5 per cent - an improvement on 13.9 per cent six months before, but still close to red hot.
In January this year, the Consumer Price Index (A) showed a 10.1 per cent year-on-year advance. This was distorted by Lunar New Year, but no one can be complacent over that sort of level.
Sir Hamish - then Mr Macleod - also addressed the effects of speculation in property and how to cool it down. That is still high on the government agenda. In 1991, prices were rising at the rate of 40 per cent, and Sir Hamish was warning of the effects on rents, and all other prices in Hong Kong.
Today, the recent trend in property prices has been down, but the jury is still out on how long it will be before the inexorable meshing of supply and demand begins to crank prices skyward again.
