Hong Kong budget stresses competitiveness, economic development

Hong Kong's financial secretary John Tsang on Wednesday proposed measures to bolster Hong Kong's position as an international hub, the promotion of industries, the keys and limits to development, and fiscal sustainability. Delivering his budget proposals for the fiscal year 2014-15 at a Legislative Council meeting, Tsang said that the proposed measures will enhance Hong Kong's competitiveness, help keep economy growing, improve business environment, increase employment opportunities and maintain the health of public finances. FASTER ECONOMIC GROWTH IN 2013 The city's economy grew by 2.9 percent in 2013, higher than the previous year's economic growth rate of 1.5 percent. The domestic sector remained resilient amid challenges facing the global economy in 2013, according to Tsang. "China's robust economy is the driving force of economic growth in the region and underpins the Hong Kong economy," the financial secretary said, "more than half of Hong Kong's exports of goods went to the mainland market, outpacing other markets." Tsang said Hong Kong's economic growth is expected to expand by 3 to 4 percent in 2014, lower than the average annual growth rate of 4.5 percent over the past decade. He warned that 2014 remains a challenging year due to the uncertainty around the U.S. quantitative easing exit strategy, the sluggish economic recovery in the eurozone, Japanese government's heavy debt as well as geopolitical uncertainties. Tsang cited faster economic growth in the mainland, positive local consumption, growing inbound visitor numbers and increasing major infrastructure works as boons to the city as it tries to accelerate its economic growth. On inflation, he said the headline inflation for 2014 will average 4.6 percent and underlying inflation at 3.7 percent.