Budget Speech

"Big Market, Small Government"

35.      With economic globalisation and advances in technology, any economic fluctuation or crisis will ripple through more rapidly and extensively. Being a small and open economy, Hong Kong will inevitably be affected.

36.      The market mechanism remains the best means to make effective adjustments in a fast-changing age. The market is the aggregate of the choices of many participants. Their decisions should work more flexibly and efficiently than those made by the Government. Under the principles of "Market Leads, Government Facilitates" and "Big Market, Small Government", the Government will continue to create conditions for market development. These include maintaining the rule of law and a simple and low tax regime, nurturing talent, investing in infrastructure, and helping enterprises tap markets outside Hong Kong.

37.      While acknowledging the importance of market mechanism, the Government will not be completely passive in regards to the adjustment of the economy and the allocation of resources. Where necessary, the Government will introduce measures to safeguard social stability and sustain the normal operation of the economy in the face of fluctuations in a fast-changing economic environment.

38.      During an economic downturn, some people are trapped in difficulties for various reasons. Therefore, the Government adopted a pragmatic and flexible approach and introduced expansionary measures during the financial crisis to stabilise the economy and safeguard the livelihood of our people. When our economy is in the early stage of recovery, it is still necessary for the Government to take measures to help those who have not benefited immediately from the recovery or adapted themselves to the new economic environment. Once the economy resumes steady growth, the Government should let our society and economic activities return to normal operation.

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