Hong Kong unveiled its annual financial budget on Wednesday, as the city found itself swimming in cash again.
The budget, which came after Hong Kong’s fastest economic growth in six years, has identified innovation and technology (I&T) as new economic drivers. With over $50 billion funding injected into the two sectors, it is justifiable to say that the government continues to put strong emphasis into I&T related items.
Charles Peter Mok, a Hong Kong-based Internet entrepreneur who represents the Information Technology functional constituency on the Hong Kong Legislative Council, thinks the government could do more in this regard.
“Many people in Hong Kong has thus far complained that the state of our I&T industry and adoption has been lackluster. Has the government learned what else need to be done, in addition to more and more funding injection? Yes and no,” Mok told Harbour Times.
“We still have not seen enough specific measures or targeted outcomes from the budget that address some key concerns such as developing talents, reviewing existing legislations and regulations, opening up government data,” said Mok. “Most of these do not necessarily require huge funding but more a determined will to change. Yet, the government continues the policies of previous years in heavily investing in [physical] infrastructures and setting up funding schemes. Those will not be enough.”
Mok added that while the government attempted to support small to medium sized enterprises (SMEs) by replenishing several SME related funds, it must realize money is not the only things SMEs need.
“They need a bigger market, and more relaxations on business restrictions. One SME told me that they haven’t yet seen how they can immediately benefit from these billions of dollars, but what they know for sure is that they still cannot find a bank in HK to open up a bank account,” said Mok.
On the other hand, Dutch-born Chinese citizen, Hong Kong environmentalist and politician Paul Zimmerman is somewhat satisfied with the budget regarding the housing aspects.
“Indeed, the private flat production for the coming year appears to be beyond the 20k target,” said Zimmerman in an email response. “The government should now consider re-allocating a number of the available residential sites originally on the land sale list for subsidizing housing as these have yet to meet the target.”
In terms of district facilities, Zimmerman is happy to find out that the government would allocate HK$8 billion to implement proposals for district facilities, as it was one of budget items he recommended to the Financial Secretary earlier this year. “We are eager to learn more about the details of the program. Spending HK$8 billion on district facilities will benefit both the community as well as create opportunities for the small and medium size professional firms.”
Just because you can collect it doesn’t mean you know what to do with it
On the other hand, Nick Sallnow-Smith, chairman of Hong Kong-based think tank the Lion Rock Institute, said the government should consider the bigger picture and reconsider its position of sitting on a large pile of cash reserve every year.
“With a huge surplus that keep on increasing year by year, it is almost like the government could not resist poking around every aspect in the city. However, whether the money is being invested on areas that are best for the city and its citizens is highly debatable.” Sallnow-Smith told Harbour Times in a phone interview.
“The government should consider reducing tax across the board. By doing that, you roughly remove the big surplus, and at the same time you allow businesses and individuals to keep their own money to decide what is the best to spend it on,” said Sallnow-Smith. “The government seems to be taking more money than they need, and then spending it on areas that they think is useful, which people do not necessarily agree with.”
Sallnow-Smith believes this has created a society where citizens rely too much on the government to solve their problems.
“Taking this year’s financial budget as an example, a significant portion of the surplus- nearly one third of them- will go into helping innovation and technology.” he said. “But why did the government assume the sector needed help? The idea of letting a government to decide who or which sector deserves the opportunities to receive subsidies, grants, or be provided cheap rents is already wrong in the first place.”
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