TNAG-2753-FCO40-3968-Budget-of-Hong-Kong-1993 — Page 30

港總督府

GOVERNMENT HOUSE

HONG KONG

SECRET

In Jurister hu

1 March 1993

You will probably be aware that the Financial Secretary will present his Budget Speech to the Legislative Council on 3 March 1993.

I am writing to advise you in strict confidence of the contents of our latest financial forecasts for the period to 1996-97, which will be published as an appendix to the speech. The figures will not become public until 3 March. The forecast is for fiscal reserves at 31 March 1997 of a little over $78 billion (an increase of about $7 billion over the forecast in the 1992 Budget Speech). The key figures are as follows:

Balance at 1 April Surplus/ (Deficit)

for the year

Reserve Balances

42.93

9319+

4195 959

697 99,050 119,590 116,230 99,570 86,280

20,540

(3,360) (16,660) (13,290) (7,900)

Balance at 31 March 119,590

116,230 99,570 86,280 78,380

Year End balance as

a % of expenditure

in the year

109.7%

87.7%

64.3% 47.2%

39.1%

The Financial Secretary is forecasting that we will be drawing on our reserves in the years 1993-94 to 1996-97. The amounts of these drawings are forecast to peak in 1994-95 and to be on a declining trend thereafter.

The SARG's finances will of course be considerably stronger. On its inception the SARG will have available the accumulated balance in the Land Fund, in addition to the accumulated fiscal reserves referred to above. The SARG will also enjoy, from 1 July 1997, retention of the full proceeds from land sales and annual rents arising from the extension of land leases beyond 30 June 1997. There should therefore be no problem in achieving balanced budgets.

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