The 2025-26 Budget is truly invigorating, akin to injecting a shot of adrenaline into Hong Kong’s economy, showcasing the special administrative region government’s determination to pursue change while upholding stability.
From economic responses and technological innovation to green development and regional cooperation, this budget not only addresses immediate needs but also outlines a blueprint for Hong Kong’s future.
It transcends a mere fiscal plan, serving as an opportunity for Hong Kong to reposition itself on the global stage, reflecting the government’s foresight and resolve.
Last year, despite a complex international landscape, Hong Kong achieved a 2.5 percent economic growth rate, bolstered by national support policies, proactive measures, and the United States’ interest rate reduction cycle.
The government has introduced a fiscal consolidation plan targeting a 7 percent reduction in recurrent expenditure by the 2027-28 fiscal year, while safeguarding livelihoods.
Adjustments to taxes and fees, such as raising the air passenger departure tax to generate an additional HK$1.6 billion ($205.83) annually, lay a foundation for future development. This balanced approach is both pragmatic and commendable.
Technological innovation shines as a cornerstone of the budget. The government will establish the Hong Kong AI Research and Development Institute with a HK$1 billion allocation to propel AI development, aligning with global trends.
Initiatives like the New Industrialization Funding Scheme and the Innovation and Technology Accelerator Pilot Scheme aim to enhance enterprises’ smart manufacturing capabilities.
Additionally, the Hong Kong Space Robotics and Energy Centre will contribute to China’s space missions, reinforcing Hong Kong’s technological stature.
Qi Bin, deputy director of the Liaison Office of the Central People’s Government in the Hong Kong SAR, has emphasized that Hong Kong’s capital market should seize opportunities amid evolving dynamics, particularly in technological innovation.
As an international financial hub, he believes Hong Kong must refine market oversight and efficiency to attract high-quality listings. The budget’s tech-focused measures echoed Qi’s perspective, and he might further advocate for enhanced talent attraction policies, such as tax incentives, to solidify Hong Kong’s role as an Asia-Pacific innovation hub.
The Northern Metropolis plan is generating excitement. The Northern Metropolis university town and a third medical school will elevate education and healthcare standards in the city. Collaboration with Shenzhen to develop a cross-border logistics network and accelerate infrastructure in the Lok Ma Chau Loop reflects bold ambition.
The commencement of the Northern Link between Kwu Tung and Kam Sheung stations and planning for the Hong Kong-Shenzhen Western Rail Link will modernize the transportation network. This region is poised to become a new economic engine, integrating into the Guangdong-Hong Kong-Macao Greater Bay Area to unlock growth potential.
Sustainability efforts are robust, with an additional HK$180 million allocated to expand the smart food waste collection network, advancing the goal of “zero waste to landfills”. Projects like I.PARK1 and I.PARK2 will bolster waste management capacity. In transportation, subsidies for electric buses, taxis, and trials of hydrogen fuel cell vehicles promote green mobility.
By 2030, 3,000 high-speed charging stations will support widespread electric vehicle adoption. These initiatives not only cut carbon emissions but also enhance Hong Kong’s appeal in green finance.
Enhanced cooperation with other Greater Bay Area cities in healthcare, finance, and youth exchanges underscores Hong Kong’s pivotal role.
The Greater Bay Area Clinical Trial Collaboration Platform will speed up new drug development, while instant small-value remittances and the MPF “full portability” arrangement improve financial convenience.
The talent attraction program has approved over 270,000 applications, introducing 66 key enterprises and boosting competitiveness. At a recent private enterprise symposium, a 1990s-born entrepreneur took center stage, symbolizing the younger generation’s economic prominence. The 2025-26 Budget’s focus on talent and youth development aligns with this shift.
In housing, the government plans to deliver 190,000 public housing units and 17,000 private residential units over the next five years, gradually addressing demand.
Infrastructure projects like the South Island Line (West) and Route 6 will improve connectivity. Tax relief on rates, salaries and profits, alongside increased elderly service vouchers and adjusted transport subsidies, ease residents’ burdens.
The HK$2 transport subsidy program has been fine-tuned with a monthly cap of 240 trips, ensuring mobility for the elderly and disabled while reducing government expenditure.
Under this “concessionary fare cap” scheme, beneficiaries enjoy 240 discounted trips monthly — averaging eight daily — sufficient for routine travel. Beyond the cap, additional fares apply, a design that meets basic needs while curbing overuse, reflecting policy rationality.
The 2025-26 Budget adopted a forward-looking strategy to unveil Hong Kong’s boundless potential. From fiscal prudence to technological leaps, green transformation to regional synergy, and livelihood support, Hong Kong is boldly tackling challenges.
With government, businesses, and residents united, Hong Kong can realize its vision of “defining the future with action and breaking boundaries with innovation”, emerging as a more prosperous, sustainable, and global city. This is Hong Kong’s “moment of transformation”, worthy of anticipation and support!
The author is a specialist in radiology, Master of Public Health of the University of Hong Kong, and an adviser of the Our Hong Kong Foundation.
The views do not necessarily reflect those of China Daily.
