It is appropriate that the Budget speech does not include any major change in fiscal measures, because: (1) it is not certain whether there is a structural deficit, the government needs to evaluate the situation first before proposing any changes. (2) Hong Kong economy is not fully recovered. Any change in the present system will affect the market sentiment.

The government's initiative to review the tax regime can work on the nature of the deficit (whether it is a structural one), and can evaluate the impact of e-commerce on government revenue yield.

We have been advocating the multi-currency clearing system as the volume of Hong Kong dollars is limited. We welcome the government's initiative to kick off the system.

The current ratio of public spending is too large. It is more ideal to contain spending than opening up new revenues. The budget fails to contain public spending, putting a question mark to the small government principle. The government should carefully review what items should be trimmed, taking into account not just recurrent expenditure but also capital expenditure.