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Ng Kang-chung

Hong Kong’s spending should not grow faster than its income, even though the city’s finances are improving, Paul Chan Mo-po has said, adding that the market expects the government to invest more to boost the economy.
But the finance chief on Sunday also painted a rosy picture for the city’s retail sector, revealing that sales figures for December, set to be released on Tuesday, would show continued growth.
Retail sales in November 2025 were provisionally estimated at HK$33.7 billion (US$4.3 billion), representing a 6.5 per cent increase year on year.
Chan is expected to announce the next budget on February 25.
In his weekly blog post, he said the local economy had got off to a good start in 2026, with unexpectedly high stamp duty revenue thanks to a boom in the city’s stock market.
The bourse’s benchmark Hang Seng Index closed at 27,387 last Friday, up by nearly 7 per cent for the month. January’s average daily turnover exceeded HK$272 billion, an increase of 90 per cent compared with the same period last year.
Chan noted that a stock market boom over the past year had helped the government’s operating account return to surplus in the 2025-2026 financial year, a year earlier than originally estimated.
He added that the government would still need to issue bonds to cover a shortfall in its capital account.

In his budget last February, Chan estimated a consolidated deficit of HK$67 billion for 2025-26, and had forecast the operating account would return to a surplus in two years.
The city already posted a HK$43.9 billion surplus for the nine-month period that ended last December.
Chan said the operating account benefited from last year’s buoyant financial markets. “With average daily turnover in Hong Kong stocks nearly doubling year‑on‑year to around HK$250 billion, stamp duty revenue exceeded budget expectations,” Chan wrote.
“In fact, whether viewed from the consolidated account or the operating account … Hong Kong’s public finances are indeed improving.
“As for the capital account, continued investment in infrastructure and the Northern Metropolis means bond issuance will still be required.”
The financial secretary acknowledged that different sectors of society had their own demands, while emphasising it was important to balance current needs with essential long-term investments.
“However, even with improving public finances, we must continue to manage public resources prudently, ensuring that the growth of public expenditure does not exceed the growth of revenue,” he said.
“During the budget consultation, people from various sectors and different walks of life expressed their hopes for strengthened support in meeting their needs.
“At the same time, the market also expects the government to increase investment, accelerate the development of more high-value-added industries, and create more quality job opportunities so that the economy can grow faster and benefit people across all sectors.
“It can be said that accelerating economic development is now a widely shared expectation in society. Expanding the economic pie will give us more resources to meet diverse social needs.”

Looking ahead, Chan expressed cautious optimism regarding Hong Kong’s economic prospects this year, pointing to stable national development and steady growth.
“With the strong support of the nation and the joint efforts of the government and all sectors of society, Hong Kong’s economy grew 3.5 per cent last year, better than initially expected,” he said.
“Overall investment also accelerated significantly, recording a notable year‑on‑year increase of 10.9 per cent in the fourth quarter, marking four consecutive quarters of positive growth and a full-year increase of 4.5 per cent.”
He also said the city’s financial system had remained stable and operated smoothly, despite heightened external geopolitical volatility, with total bank deposits exceeding HK$19 trillion.
“In fact, confidence among overseas enterprises and investors about investing in Hong Kong is strengthening,” he said.
Chan also vowed that the government would work to align with the national 15th five-year plan and accelerate integration into national development.


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Hong Kong economy

Hong Kong’s spending should not grow faster than income: Paul Chan

Paul Chan has noted that a stock market boom over the past year contributed to the government’s operating account returning to surplus in the 2025-2026 financial year. Photo: Jelly Tse

Financial Secretary Paul Chan has acknowledged that different sectors of society have their own demands, while emphasising it is important to balance current needs with essential long-term investments. Photo: Eugene Lee

Looking ahead, Chan has expressed cautious optimism regarding Hong Kong’s economic prospects this year. Photo: Jelly Tse

Hong Kong must keep cash buffer amid complicated geopolitics: Paul Chan

Hong Kong must maintain cash reserves to cope with geopolitical shocks, Paul Chan has said. Photo: Sam Tsang

Paul Chan has said that the city’s current needs and middle- to long-term development should be balanced. Photo: Karma Lo

Paul Chan upbeat about Hong Kong economy despite ‘volatility’ from Trump policies

Hong Kong Financial Secretary Paul Chan at the World Economic Forum in Davos, Switzerland, on Thursday. Photo: Handout

US President Trump delivered a freewheeling and combative speech in Davos on Wednesday, sparking concern among world leaders despite walking back his threat about taking Greenland by force. Photo: Reuters

Hong Kong won’t pursue carbon-based taxes under bid to go green: Paul Chan

Hong Kong is tackling decarbonisation through its Climate Action Plan 2050, focusing on net-zero electricity by phasing out coal for backup, increasing renewables and promoting green transport with electric vehicles. Photo: Karma Lo

Financial Secretary Paul Chan speaks at the World Economic Forum. Photo: Handout

News

Hong Kong

Hong Kong Economy

Finance chief issues call ahead of expected budget speech on February 25, says local economy off to good start in 2026


Finance chief issues call ahead of expected budget speech on February 25, says local economy off to good start in 2026.


Paul Chan

Hong Kong budget 2026-27

Northern Metropolis

Hang Seng Index

Hong Kong’s spending should not grow faster than income: Paul Chan

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Finance chief issues call ahead of expected budget speech on February 25, says local economy off to good start in 2026

Finance chief issues call ahead of expected budget speech on February 25, says local economy off to good start in 2026