"Letter to Hong Kong" on Budget  (English only)

Following is the "Letter to Hong Kong" on the 2017-18 Budget by the Financial Secretary, Mr Paul Chan, broadcast on Radio Television Hong Kong on March 5:

Hello, Hong Kong.  I'm pleased to have this opportunity to speak to you, this good Sunday morning, about the 2017-18 Hong Kong Budget.

When people think about the Budget, usually the first thing comes to their mind is the plenty of numbers in it.  But to me, the Budget is not just a collection of cold and hard figures.  It indicates the priorities set by the Government, reflecting the values we hold and the aspirations that we wish to fulfill.

That exactly is one of the key messages that I hope to convey in my Budget: how the Government can make good use of our public resources and play an active facilitation role in developing Hong Kong into an even more liveable, sustainable and vibrant city.

To realise these goals, I set out three clear objectives:

First, the budget must help power our economy and, in doing so, improve the lives of the Hong Kong people.

Second, it must not be short-sighted.  Rather, it must invest in our future, making Hong Kong an even more gratifying city in which to live and work and raise our families.

Finally, the budget must take good advantage of our financial resources to help create a society in which we all share in the economic, cultural and social rewards.

In fuelling our economy, we must look to our pillar industries, shore them up, expand them for the demands of tomorrow's global economy.  I have announced various measures in the Budget to build on our success at the highest levels, and help further consolidate our competiveness in trading and logistics, financial services, tourism as well as business and professional services.

Pillar industries aside, innovation and technology will be our new engine for economic growth.  It's why we are establishing an innovation, technology development and re-industrialisation committee.

Why we are setting aside $10 billion to support I&T development.  Start-ups can count on our continuing support, as can our fast-emerging fintech businesses.

We will be setting up a dedicated tax policy unit to study ways to foster development of our industries, as well as to enhance our tax regime and to ensure that Hong Kong remains competitive.

It is my strong belief that sustained and diversified economic development of Hong Kong can only expand opportunities for our youth.  And their promising future.

Infrastructure will help drive that future, enhancing our competitiveness, boosting our quality of life and, no less vital, creating thousands of jobs in construction, transport and other industries.  For the coming fiscal year, we will be spending more than $86 billion on capital works projects.

Transport – linking people, places and businesses faster and efficiently – headlines our infrastructure agenda.  Major undertakings include:-
•   the Shatin to Central Railway Link
•   the Tuen Mun – Chek Lap Kok Link
•   the Central Kowloon Route
•   the Central-Wan Chai Bypass, as well as the Tseung Kwan O-Lam Tin Tunnel.

Infrastructure will also ensure that the people of Hong Kong can continue to be provided with affordable and quality healthcare services.  That's central to our community's well-being.

It's why, in last year's Budget we earmarked $200 billion for a 10-year hospital development plan.  The Hong Kong Children's Hospital in Kai Tak is expected to open next year.  Preparatory and design works for an acute general hospital there with 2 400 beds will also take place this year.  In addition, over ten hospitals across Hong Kong will be redeveloped or expanded, with additional community health centres built.

Housing is at the top of the agenda of the Government and at the heart of our infrastructure development – today and long into the future – because housing is vital to the well-being of the Hong Kong people.  Because housing speaks of our collective hopes and dreams.  Because housing will surely make Hong Kong an even more livable city.

In this, our determination is everywhere to be seen.  Or soon will be.  Consider, for example, the Tung Chung New Town Extension, a major project in meeting our medium-term housing needs.

The reclamation of about 120 hectares of foreshore and seabed in Tung Chung East was recently approved by the Town Planning Board.  Construction will begin next year.  The New Town Extension is expected to yield more than 49,000 flats and nearly 900,000 square metres of commercial floor area.

Call it buried treasure, and know that it will, soon enough, be shared among Hong Kong families and Hong Kong businesses.

Construction of another major housing development, this one in Tai Po, is expected to begin by mid-year.  The project will yield more than 7,000 public housing flats, embracing a population of 17,500.

That's just two examples.  There are many more out there, and, rest assured, many more will follow.

If we put a premium on housing, we are equally committed to caring for our community and to working hard to build a fair society, a just society, a Hong Kong that shares its good fortune.  That insists that our elderly, our disadvantaged and our disabled share in the fruits of our success.

It's why, in my Budget, I reserved $30 billion to strengthen our elderly and rehabilitation services.  Why we will ensure that residential care, day care, community support and other equal-opportunity initiatives and programmes are enhanced.  Made accessible for all.

I also earmarked $20 billion to put in play 26 sports and recreational facilities in different districts over the next five years, in addition to the $32 billion Sports Park in Kai Tak.

Human capital is Hong Kong's most valuable asset.  We have been investing heavily to nurture young talent with global vision and cross-cultural competence, in order to drive the diversified development of our knowledge-based economy.

In the Budget, I have earmarked $1 billion for youth development, for strengthening professional and vocational education, as well as for sponsoring more young students to join exchange programmes and study abroad.  These programmes are essential in enriching exposure and broadening horizons of our younger generation.

In short, while budgets necessarily work with numbers, those numbers will never amount to much, if we don't build in our values and our aspirations, and if we don't spend our surplus wisely and prudently for investing in our future.

Before I leave you to your Sunday morning leisure, let me add that this year is the 20th anniversary of the Hong Kong Special Administrative Region.  Much is planned, and we hope to make it a joyous year for Hong Kong.  For each and every one of you.

Thank you and have a great day.

Your Financial Secretary,

Paul Chan

March 5, 2017