Hong Kong Cuts Civil Service Jobs and Public Sector Pay in Bid to Reverse Huge Deficit
Hong Kong aims to cut spending by slashing 10,000 civil service jobs in an effort to rein in a rising deficit, and plans a big AI push as it navigates headwinds from global economic uncertainty, geopolitical tensions and a weak property market. The government's fiscal consolidation programme will see a cumulative reduction in public expenditure by 7% from now till fiscal year ending on March 31, 2028. Public sector salaries will also be frozen this year.
- By streamlining its civil service and reducing public spending, Hong Kong is seeking to address the underlying drivers of its rising deficit, which could have significant implications for the city's economic stability in the coming years.
- As the global economy continues to grapple with uncertainty and protectionism, how will Hong Kong's decision to prioritize AI development and self-reliance impact its relationships with other countries, particularly China?