Hong Kong’s budget deficit will be below $100 billion, its finance chief told Reuters.

HONG KONG (Reuters) – Hong Kong’s fiscal year deficit will be below US$100 billion ($13 billion), the city’s finance chief said on Saturday.

The government is “focusing on cost-saving measures” to address the deficit, Paul Chan told residents on public broadcaster RTHK, which is gathering public feedback ahead of the upcoming budget.

“While we must move forward with public works projects… we must prioritize development as needed,” he said.

In the year Economic growth in the first three quarters of 2024 was not as strong as expected due to high interest rates and external challenges, Chan said.

Hong Kong’s economy is expected to grow by 2.5% in 2024, he wrote in a blog post in December. This followed third-quarter growth of 1.8%, which fell short of expectations.

The estimated deficit at the end of March is almost double the HK$48.1 billion forecast in the budget presented in February.

Chan attributed the shortfall mainly to lower income from land sales. Growing the economy amid a budget deficit is Hong Kong’s biggest challenge, he said.

($1 = 7.7779 Hong Kong dollars)