<div id="readability-page-1">Hong Kong must exercise fiscal prudence, carefully weighing social needs while maintaining adequate reserves to guard against unforeseen circumstances, the finance chief has said as he outlined the principles of the budget he will deliver on Wednesday. Financial Secretary Paul Chan Mo-po on Sunday also revealed the purple cover of the coming 2026-27 budget, saying the colour symbolised Hong Kong’s strengthening economic momentum amid a volatile external environment. The remarks came as the city braced for more global trade uncertainties, with US President Donald Trump announcing on Saturday his decision to raise a temporary global tariff on all imports to the country from 10 to 15 per cent with immediate effect. His move followed a US Supreme Court ruling against his earlier sweeping emergency duties. “Facing a volatile external environment and uncertainties in the process of economic transformation, we must manage our finances prudently, consider the short, medium and long-term needs of society, and maintain a certain level of reserves to deal with any unforeseen circumstances that may arise,” Chan said in his weekly blog. Chan said the current administration had been striving to boost the economy, pursue development and improve people’s livelihoods in a way that was “consistent” with residents’ expectations. He cautioned that the path towards these goals and the allocation of resources often faced real-world constraints, saying the government must inevitably prioritise and make “difficult trade-offs” when drafting the city’s budget blueprint. Earlier this month, Chan said that a stock market boom had helped the government’s operating account return to surplus in the 2025-26 financial year – a year earlier than projected. The improved public finances prompted a growing chorus for more relief measures and financial “sweeteners” in this year’s budget. “We have listened carefully to the opinions and ideas from all parties, and in preparing the budget, we will conduct a holistic assessment to ensure the proposed measures achieve an overall balance,” Chan said in his blog.  The finance chief reiterated that the city’s economy had got off to a good start this year, following sustained economic growth in 2025. “The cover of this year’s budget is purple, symbolising the continuous strengthening of Hong Kong’s intrinsic economic momentum amid a rapidly changing external environment. Let us work hand in hand and strive tirelessly for the higher-quality and more inclusive development of Hong Kong’s society and economy,” he said. Chan warned in January that Hong Kong must navigate a tense geopolitical climate marked by rising unilateralism and hegemonism, noting potential tariff wars and shifting Western trade policies towards China as significant risks that could trigger heightened market volatility and disrupt the city’s trade performance. Earlier this month, he stressed the importance of aligning with the national 15th five-year plan, saying he would prioritise technology as a primary engine for prosperity in his budget blueprint, particularly scaling up investments in artificial intelligence and digital transformation to create higher value-added jobs and boost productivity. He added that the budget would strengthen Hong Kong’s status as a global financial hub through deeper integration of technology into industry to drive economic diversification.</div>

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<p>Hong Kong's Financial Secretary Paul Chan emphasized the need for fiscal prudence in the upcoming 2026-27 budget, balancing social needs with adequate reserves amid global trade uncertainties. He highlighted the importance of managing finances carefully while addressing the city's economic transformation and residents' expectations. Chan noted that improved public finances from a stock market boom have led to calls for relief measures. The budget will focus on technology investments to enhance productivity and maintain Hong Kong's status as a global financial hub, symbolized by the purple cover of the budget.</p>

- The Financial Secretary of Hong Kong emphasizes the need for fiscal prudence while balancing social needs and maintaining sufficient reserves to tackle unforeseen challenges.  
- Amid increasing global trade uncertainties, he reveals that the upcoming 2026-27 budget cover is purple, symbolizing strengthening economic momentum during turbulent times.  
- He warns of the resource allocation realities in achieving economic development and improving living standards while advocating for an investment focus on technology and digital transformation to promote economic diversification.

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Hong Kong budget must be ‘prudent’, balance social needs and reserves: Paul Chan