John Tsang’s budget aims to heal the political divide in Hong Kong
Social investments to help the young, elderly, middle class and small businesses sets the stage for next year’s chief executive election
Financial Secretary John Tsang Chun-wah is more renowned for his largesse when announcing the budget than showing foresight or coming up with innovative ideas. That perception was reinforced by the blueprint he delivered at the Legislative Council yesterday. His 90-minute speech was laden with sweeteners for almost everyone, but it lacked vision and substance. It may even have elicited yawns from those who have grown accustomed to his giveaways over the past eight years.
But it would be wrong to say that Tsang has lost sight of the need to invest in a better future. With the new Innovation and Technology Bureau up and running, he rolled out a raft of measures to support start-ups and offered research grants to help develop new sources of economic growth. Although the financial commitment may not look overly impressive, innovation and new technologies are set to be the new engines of growth for Hong Kong’s economy. The initiatives to boost internships and exchange programmes with the mainland, as well as increased help for elderly citizens are also good social investments.
As expected, Tsang was not as generous with sweeteners as in the past. This is a step in the right direction. But the tax concessions and other relief measures in the coming financial year will still amount to HK$38.8 billion, compared with HK$34 billion in 2015/16.
Amid growing signs of a weakening economy, the finance chief has sensibly provided the business sector with some respite. The registration and licence fee waivers for various industries will be welcomed, especially by small businesses. Also, the concessions for the middle class are more generous this year, with higher tax allowances and property rate waivers.
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That the speech was short on economic substance is disappointing, but unsurprising. Given this was his second to last budget in the administration’s current term, Tsang appears to have opted for a safe approach. By the time he delivers his final budget early next year, the jockeying to be the next chief executive will be in full swing. Although he would not be drawn on his prospect of joining the race, he raised eyebrows when he weighed in on controversies surrounding this month’s riot in Mong Kok and the growing political divide. His tone was noticeably milder than that of Chief Executive Leung Chun-ying. But the message is the same: our society has become more polarised; rational debate has been replaced by confrontation and violence. If no efforts are made to break the deadlock, the tension is bound to add uncertainties to the economic headwinds we are facing.