Editorial | In Hong Kong, there is such a thing as a free lunch
- E-voucher handouts by the government have won near-universal praise for boosting a fragile, pandemic-hit economy, but how long they will last is anyone’s guess
Economists may be divided over the efficacy of giving handouts to boost consumption, but everyone loves free money. The feel-good factor may be hard to quantify. The Hong Kong government, though, must have taken that into consideration when it first launched the consumption voucher scheme back in 2021, when the economy was hit hardest by the Covid-19 pandemic.
Today, the economy is recovering, but slowly. Such handouts may not be a sustainable solution. Even so, businesses need all the help they can get. To manage expectations, Financial Secretary Paul Chan Mo-po has declined to make them a regular exercise. He has not, however, ruled them out further down the road.
The latest instalment of e-vouchers is worth HK$2,000 each for permanent residents. They come after the last HK$3,000 paid in April and will be available by mid-July.
When the scheme was first launched two years ago, the payout was HK$10,000. The cutback to HK$5,000 is understandable as the economy is picking up. The recovery, however, has not been evenly spread.
Consumer sectors such as hospitality, restaurants and shops have been hit hardest. Many are expected to roll out matching promotions to encourage spending. A boost to consumption is crucial to keep the momentum of recovery going.