Hong Kong must not give up on its youth and should invest in future generations, Finance Secretary Paul Chan said at a forum Saturday, Radio Television Hong Kong reported.
The city faces declining income and a growing deficit as it tries to deal with ongoing social issues, Chan said. Hong Kong has endured seven months of violent protests, driven mainly by the youth, that have taken their toll on the retail sector and tourism, and dragged the economy into its first recession in a decade.
The government has pumped more than HKD35 billion ($4.5 billion), about 1.2% of 2018 gross domestic product, into the economy since the protests started, Chan said. Hong Kong needs to increase the supply of subsidized housing to provide affordable homes to more people, one of the city’s most pressing issues, RTHK cited Chan as saying.
Chief Executive Carrie Lam has announced a welfare package of HKD10 billion, focusing on the city’s more vulnerable people, but Chan suggested on Saturday that the government might have to cut back on other relief measures such as tax rebates because of the general increase in spending.
While the ongoing social unrest has hit Hong Kong’s economy, demonstrators’ demands are centered more on calls for greater democracy and less interference from China. The protests have divided the city’s society and often end in violent clashes between police and activists.
In past weeks there has been a lull in protest activity but a major rally is scheduled for Sunday. Police have withheld approval for a planned march on concerns it could turn violent.
Police last week defused a pipe bomb and arrested four men for allegedly manufacturing explosives. On Friday, a Hong Kong policeman was arrested along with eight others for posting political fliers, reported TVB. That was the first officer to be arrested for protest-related events.
Economists forecast an annual contraction of 1.3% for 2019 mainly due to the protests. The unemployment rate rose to 3.2% in November, with joblessness in the retail and tourism-related sectors rising the most in three years to 5.2% from the September-to-November period. Kari Lindberg, Bloomberg
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