Vouchers to spur private consumption growth, improve employment: FS Chan

The effects of the consumer vouchers will be seen this month.

Finance Secretary Paul Chan on Sunday said the consumer voucher will lead to an increase in private consumption and will improve employment in some industries.

Chan said the employment situation has improved in different industries, with the unemployment rate combined with the consumer and tourism-related industries falling from the 11% peak at the beginning of the year to the current 7.6%.

“It is worth noting that even though the employment situation in various industries has gradually improved, it has not fully recovered to the level before the outbreak of the epidemic early last year,” he said in his blog. 

He cited the retail, accommodation, and catering services as examples, noting that the unemployment rate in related industries is still higher than the 5.2% level before the epidemic.

“We expect that as the effects of consumer vouchers begin to appear in August, they will further stimulate the growth of private consumption and will further improve the employment situation in related industries,” Chan said.

Application for the $5,000 vouchers ended on 14 August.

However, he said that the improvement of the economy and job market depends on the situation in the epidemic and the effectiveness of prevention and control measures. It is also anchored on the vaccination drive.

Meanwhile, he also noted that the financial services industry is Hong Kong’s “strongest link” in the economy, saying they have to be at the forefront in consolidating Hong Kong’s status as an international financial centre. He said that it is important to ensure that financial development can serve the “real economy.”

“We should not just focus on stocks and asset management and other links, but need to review the development blueprint of the entire chain and the entire industry, make overall plans, and proceed step by step and proceed steadily,” he said.

He noted that the most important aspect in the allocation of funds of financial institutions is “precise investment and risk management” for effective use of funds and leveraged returns under controllable costs.

One of the industry’s main directions for development is the expansion of the offshore RMB fund pool and related investment products in Hong Kong to allow companies and institutions holding offshore RMB funds to deposit, manage, and allocate offshore RMB funds in Hong Kong in a “one-stop” manner.

China’s 14th Five-Year Plan also supports the strengthening of Hong Kong’s development as a global offshore RMB business hub, international asset management centre and risk management centre, providing a blueprint for development, Chan said.

“The social and economic development of Hong Kong has always been closely linked to the development and needs of the Mainland,” he said, adding that a “deeper understanding” of the situation and deployment of the country’s development will allow Hong Kong to have opportunities for development in the Mainland.