As Hong Kong reviews the scale and methods of issuing bonds in the coming years while formulating the budget, Financial Secretary Paul Chan Mo-po has reiterated that bonds would be used to support Northern Metropolis projects as part of efforts to turbocharge the city’s growth.
Writing in his Sunday blog, he said the special administrative region government will ensure that Northern Metropolis projects, which are of vital importance to the city’s future development, will not be “bound hand and foot by the state of public finances”.
The Northern Metropolis has what it takes to provide extensive development space for cutting-edge technologies such as “AI+” and emerging industries, as well as the transformation and upgrading of traditional industries.
In a broad sense, it stands as a compelling episode of regional integration and synergy. “By building a comprehensive innovation ecosystem and capitalizing on the advantages of the Guangdong-Hong Kong-Macao Greater Bay Area’s advanced manufacturing and market scale, we’ll promote coordinated development of the region,” Chan said.
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Hailing the Northern Metropolis projects as the “key contributing factor to Hong Kong’s vision of jumping on the technology revolution bandwagon” and the “carrier of the next growth engine for Hong Kong’s economy”, the finance chief said the administration will make smart use of market forces to get them off the ground.
This would include the plan to accept tenders for three pilot development areas in the Northern Metropolis by the second half of this year.
“To promote strategic infrastructure development and expedite the release of new industrial land, Hong Kong is well-positioned and equipped with the ability to moderately increase its bond issues and leverage market forces,” he said.
According to Chan, Hong Kong’s government debt to the gross domestic product ratio currently hovers at 9.3 percent, in stark contrast to many developed economies whose ratios go well beyond 100 percent.
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On the supply side, the SAR government aims to raise funds to back long-term strategic projects and invest for the future. On the demand side, global investors are betting big on having a share of the bigger story unfolding in the financial hub.
In the 2024-25 fiscal year, Chan noted that subscriptions from institutional investors for green and infrastructure bonds issued by the SAR government were nearly three to seven times the amount offered.
“Such a robust demand is a vote of confidence in Hong Kong’s future development,” he said.
