Although Financial Secretary John Tsang Chun-wah's budget speech held few surprises, it did not disappoint either.

Despite a much smaller than expected surplus, at HK$30 billion, Tsang has proposed relief measures which are at least comparable to those of the previous fiscal year which had a surplus more than twice as large.

The generous handouts, including a much anticipated tax rebate of up to HK$20,000 and the waiving of annual license fees to lessen the burden on small- and medium-sized enterprises, are obviously intended to help stimulate domestic consumption at a time when the local economy is troubled by worsening external factors. Tsang said that since 2015, domestic consumption, including infrastructure development and consumer expenditure, has taken over exports of goods and services as Hong Kong's main engine of growth.

In his speech Tsang predicted that economic growth in 2016 will slip further, to below 2 percent from an estimated 3 percent in the previous year. As such, the relief measures he proposed for the fiscal year beginning April 1, 2016 can make a significant difference, despite demands by some economists for stronger stimulants.

Tsang made a point in his budget speech of reminding Hong Kong people of the need for the government to maintain sizable reserves. This is expected to amount to HK$860 billion, or about 24 months of government expenditure, at the end of this fiscal year, ending March 31. The expected hard times ahead could require the government to dip into the reserves to fund the ever-increasing recurrent expenditure on education, social services and healthcare.

In the long term, Tsang has proposed numerous measures to promote innovation and technology and enhance Hong Kong's status as one of the world's leading startup hubs. Of particular interest to many Hong Kong people is his emphasis on reviving the fashion industry, with particular focus on design, and also the movie industry.

Cantonese movies, which at one time dominated the entertainment scene in Southeast Asia, still have a lot of potential, he said.

We could not agree more.

(HK Edition 02/25/2016 page4)