The Hong Kong government has announced 120 billion Hong Kong dollars ($15.4 billion) worth of measures to support its economy, which has been dragged down by pro-democracy protests and the new coronavirus outbreak.
“Since January 2020, Hong Kong has come under the threat posed by the novel coronavirus outbreak, which further dealt a blow to the economy. We must take decisive measures to tackle the situation,” Hong Kong’s Financial Secretary Paul Chan said in his budget speech on Wednesday.
Chan outlined measures to help businesses, workers, and households weather additional economic challenges posed by the virus outbreak. They include:
Low-interest loans for small- and medium-sized enterprises, with a government guarantee.
A reduction in profits tax by 100%, subject to a ceiling to $20,000.
The planned deficit for the coming financial year starting in April is much larger than the $37.8 billion fiscal shortfall expected in the current financial year — the Hong Kong government’s first deficit in 15 years.
The Hong Kong economy entered its first recession in a decade when it posted a 2.8% year-on-year decline in third-quarter gross domestic product. In the fourth quarter, the city’s GDP fell by 2.9%.