The Hong Kong government announced on Wednesday it would give HK$10,000 (US$1,280) from its budget to all adult permanent residents in the city as a relief measure amid the Covid-19 outbreak.

The government should do a bit more as the city faces an economic setback and is “overwhelmed by a heavy atmosphere,” Financial Secretary Paul Chan said in his budget speech.

“After careful consideration, I have decided to disburse HK$10,000 to Hong Kong permanent residents aged 18 or above, with a view to encouraging and boosting local consumption on the one hand, and relieving people’s financial burden on the other,” Chan said.

Chan said he expects a decline in the government’s revenue in the coming year due to the economic downturn. He said the government would record a fiscal deficit of HK$37.8 billion in the year ended March 31, the first time for Hong Kong in the past 15 years, and a fiscal deficit of HK$139 billion in the following year.

The HK$10,000 cash handout, which will cost about HK$700 million in total, is a part of the government’s HK$120 billion stimulus scheme to offset the negative impact of the coronavirus epidemic on the city’s economy. Other stimulus measures include profit and personal tax cuts and subsidies for businesses and the underprivileged.

Although cash payments to households, along with business tax cuts and subsidies to sectors most affected by the slowdown, should stimulate spending, the extent to which consumer spending is lifted will likely be constrained by two factors. These are the uncertainties around the impact of the coronavirus on global and China’s growth and the lingering effects of the 2019 Hong Kong protests, said Martin Petch, Vice President-Senior Credit Office, Sovereign Risk Group, Moody’s Investors Service.

The cash handout has been a hot topic of debate in Hong Kong for many months since the city’s local consumption was hit by social unrest in the second half of last year.

Only permanent residents

Last Friday, pro-establishment lawmakers in a Finance Committee meeting voted down a motion proposed by the pan-democracy camp for a cash handout. The debate continued until Chan announced his decision on Wednesday.

However, Chan’s decision has caused new concerns as it only covers adult permanent residents, including those who have migrated overseas, while young people, migrant workers and new immigrants are excluded.

Ben Chan Han-pan, a lawmaker with the Democratic Alliance for the Betterment of Hong Kong, said the Steering Committee on the Community Care Fund should deliver cash to new immigrants. Democratic Party lawmaker Wu Chi-wai said youngsters should be covered.

On Wednesday, the Centre for Health Protection announced that four people were identified as infected with the Covid-19 virus, bringing the total number of infections in Hong Kong to 89. The four new patients included a woman who came back to Hong Kong from the Diamond Princess cruise ship, two people related to the outbreak in a Buddhist temple in North Point and a foreign domestic worker.

Over the past one week, 11 people have been identified as infected with the Covid-19 virus after they or their family members visited the Fook Wai Ching She Buddhist temple in North Point in January and this month.

A 29-year-old domestic worker was identified as the 89th infected individual in Hong Kong on Wednesday after her 60-year-old female employer was labeled patient No 85 in the city on Tuesday.

The employer with good past health lived at Block 4, Swiss Towers, at 113 Tai Hang Road, Tai Hang. She developed a cough on February 12 and consulted a private doctor five times. She was admitted to the Hong Kong Sanatorium & Hospital on Monday and transferred to the Queen Mary Hospital for isolation and treatment on Tuesday. She had no travel history during the incubation period.

Social outings

The woman was said to be a wealthy businesswoman and a member of the Hong Kong Jockey Club who owns several companies. Over the past two weeks, she kept going to different places including the Park Lane Hong Kong Hotel, JW Marriot Hotel, Royal Hong Kong Yacht Club, World Trade Centre, Fook Lam Moon restaurant and the Man Mo Temple. She also attended a wedding ceremony with about 20 guests. Last Sunday, she went on an outing in Sok Kwu Wan on Lamma Island.

After she showed a positive result to a virus test on Tuesday, her husband, son and two domestic workers were sent to quarantine.

One of the domestic workers developed a fever on February 16 and consulted a doctor on February 20 and 24. She had stayed in her employer’s apartment in recent weeks, including on her rest days. She only visited Wan Chai for a short time on February 16.

She has become the second domestic worker who was infected with the Covid-19 virus in Hong Kong.