2
MONDAY, SEPTEMBER 17, 1984
ON BUDGETARY POLICIES, SIR JOHN SAID THE GOVERNMENT HAD ABSORBED A DROP OF ABOUT 25 PER CENT IN ANNUAL REVENUE AS A RESULT OF THE FALL IN LAND PRICES.
HE EXPECTED THE BUDGET DEFICIT FOR THE CURRENT FINANCIAL YEAR TO BE LESS THAN THE $2.1 BILLION FORECAST EARLIER.
+HONG KONG IS, I THINK, UNIQUE IN HAVING NO NET CENTRAL GOVERNMENT DEBT. IN FACT WE HAVE AT PRESENT FISCAL RESERVES, THAT IS TO SAY, A SURPLUS OF REVENUE CARRIED FORWARD, OF ABOUT HK$16 BILLION.
+EVEN TAK ING CONTINGENCIES AGAINST THIS ON A CONSERVATIVE BASIS OF 3 TO 1, WE SHOULD STILL HAVE BY THE END OF THIS YEAR FREE FISCAL RESERVES OF OVER HK$9 BILLION, HE SAID.
THE PUBLIC SECTOR'S EXPENDITURE THIS YEAR HAD BEEN SUCCESSFULLY CURTAILED, WITH ITS RELATIVE SIZE TO BE REDUCED TO 17.5 PER CENT OF GDP, DÓWN FROM 19.4 PER CENT LAST YEAR, HE SAID.
THE FORECAST RATE OF INFLATION, AS MEASURED BY THE CONSUMER PRICE INDEX, IS NINE PER CENT FOR 1984 AS A WHOLE. THIS REPRESENTS A SLOWING DOWN DURING THE YEAR, FROM OVER 12 PER CENT IN JANUARY DOWN TO PROBABLY SEVEN PER CENT BY DECEMBER.
AND SIR JOHN LOOKED TO A FURTHER DROP IN THE INFLATION RATE NEXT YEAR, WITH THE CONTINUING STABILITY IN THE HONG KONG DOLLAR REMAINING ONE OF THE FAVOURABLE FACTORS.
IN RECENT YEARS THE PROPERTY SECTOR HAS REMAINED DEPRESSED, EXCEPT FOR AN IMPROVEMENT IN THE RATE OF TAKE-UP OF FINISHED PROPERTY REFLECTING FALLING PRICES AND RENTALS.
+THESE FALLS HAVE, HOWEVER, OBVIOUSLY BENEFITED POTENTIAL HOME-OWNERS AND BUSINESSMEN WHO WISH TO EXPAND THEIR OPERATIONS IN HONG KONG.
+ IN COMPARISON WITH OTHER MAJOR CITIES, PRICES AND RENTALS FOR COMMERCIAL AND INDUSTRIAL PROPERTY IN HONG KONG HAVE NOW FALLEN TO A COMPETITIVE LEVEL, SIR JOHN SAID.
/3