The government has outlined a ‘cumulative reduction’ of government recurrent expenditure by 7% from now until 2027-2028.
To address a growing deficit, Hong Kong will cut 10,000 civil service jobs by April 2027 (a 2% reduction per year) and freeze civil service salaries. The government will reduce recurrent expenditure by 7% by 2027-2028, issue bonds worth up to 195 billion Hong Kong dollars over five years, and raise airport departure tax by 67%. Hong Kong also plans to invest in artificial intelligence, earmarking one billion Hong Kong dollars for an AI research and development institute and establishing a 10 billion Hong Kong dollar innovation and technology fund. The financial measures come as Hong Kong faces a weak property sector, economic uncertainty, and geopolitical tensions.
