Paul Chan pledges HK$54b for anti-Covid fight

Financial Secretary Paul Chan on Wednesday set aside HK$54 billion to fund Hong Kong’s anti-epidemic efforts, as the SAR battles its worst wave of Covid-19 infections yet.

This includes a HK$22 billion boost to boost testing, and additional support to the Hospital Authority; HK$6 billion to buy more vaccines; and HK$7 billion for other anti-epidemic materials and services.

Delivering his final budget address to legislators through a video-feed, Chan said a total of HK$170 billion will be spent on counter-cyclical measures that he expects will boost the economy by three percent.

The Financial Secretary said some of his budget measures are designed to relieve the hardship being faced by Hong Kong people and its small and medium-sized businesses, while other parts will focus on post-pandemic recovery, and Hong Kong’s longer-term economic development.

He acknowledged that the current wave of Covid infections has had a “profound impact” that has “dealt a heavy blow to many people, disrupting both their life and work, and seriously affected the operations of small and medium-sized enterprises (SMEs), thus undermining confidence in the future.”

“Taking prompt action to stabilise the epidemic situation is crucial for safeguarding the health and lives of our people. It is also the key to maintaining people’s confidence and stabilising our economy,” he added.

Despite the challenge of tackling Covid, Chan expressed confidence that local authorities – with the staunch support of the central government – will be successful in winning the battle.

As such, he predicted that the local economy will improve in the second half of 2022 and end up with a GDP growth of between 2 to 3.5 percent for the year as a whole.

“As long as the recent wave of the epidemic can be gradually put under control, and the status of ‘dynamic zero infection’ can be maintained down the road, consumption and investment demand will likely gather steam again,” Chan said.

“A stabilised epidemic situation will also create favourable conditions for the gradual and orderly resumption of quarantine free travel between the Mainland and Hong Kong, thereby injecting greater impetus into the economy.”

However, he acknowledged that the economy will be under ‘intense pressure’ in the short term, especially for consumption-related sectors — with unemployment expected to deteriorate.

“The economic performance in the first quarter is not optimistic,” he said.

Last updated: 2022-02-23 HKT 11:18