Hong Kong forecasts fastest economic growth in three years
HONG KONG (AFP) - Hong Kong's economy is expected to expand at its fastest pace in three years in 2014, the government said on Wednesday, while slashing public welfare spending as it cautioned over global economic headwinds and projected a narrowing budget surplus.
Financial Secretary John Tsang forecast growth of between three and four per cent, up from 2.9 per cent in 2013, as he announced a 40 per cent cut in welfare spending even as the government struggles to quell popular discontent over the city's high living costs and widening wealth gap.
He warned the global economic outlook remained uncertain as the winding back of US monetary stimulus added to the risk of capital outflows and the sluggish eurozone recovery remained a cause for concern.
"The US economy may see some improvement in 2014. Nevertheless, there is still uncertainty over the Federal Reserve Board's... strategy and interest rate policy. Possible market fluctuations and the risk of reversal of capital flows will cast shadows... this year," Mr Tsang said as he unveiled the annual budget.