“Hong Kong’s economy is facing enormous challenges this year,” Chan said. “The outlook is far from promising in the near term.”
The financial secretary said during a budget presentation that Hong Kong’s economy has been “dragged by a host of headwinds” that percolated last year, including fallout from months of mass protests, the ongoing US-China
trade war and the slowing global economy.
Those issues pushed Hong Kong into recession, with the economy shrinking 1.2% overall last year, marking its first annual decline since the global financial crisis.
Now, it is also confronting the spread of the novel coronavirus, which “has dealt a severe blow to economic activities and sentiment in Hong Kong,” Chan told the city’s Legislative Council.
Some of the money for the relief package will come from a special fund that has been established “in view of the deteriorating economic and employment conditions as a result of the novel coronavirus epidemic,” Chan said.
In addition to the government handout, the government will also slash income tax for some residents, he said, adding that this would impact almost 2 million taxpayers. Authorities also plan to give low-income residents of public housing a month of free rent, as well as provide a one-off allowance to 200,000 underprivileged households.