Finance
Issuing bonds to tackle Hong Kong deficit not ‘monstrous’: ex-minister Henry Tang
Hong Kong’s plan to issue bonds to tackle a dire deficit is not “monstrous” but rather a legitimate short- to medium-term solution to improve capital flow, former finance minister Henry Tang Ying-yen has said.
Tang on Tuesday defended the government’s plan, which Financial Secretary Paul Chan Mo-po announced in his budget blueprint, after his successor, John Tsang Chun-wah, warned the measure could affect the city’s credit ratings.
According to Chan’s budget speech last week, Hong Kong planned to issue HK$120 billion (US$15.3 billion) in silver, green and infrastructure bonds to cover the government’s recurring expenses. He remained confident that the city would balance the books within three years.
Tsang, the longest-serving financial secretary from 2007 to 2017, earlier said in a social media post that the city needed to look beyond bond issuances to cover government spending. He also argued the government had “undeniably fallen into an era of structural deficit”.
Speaking in Beijing as a member of the Standing Committee of the Chinese People’s Political Consultative Conference (CPPCC), Tang, who was the financial secretary before Tsang, called the plan “completely legitimate” as long as there was market demand.
“Bond issuance for the purpose of maintaining government operations is not monstrous,” Tang said.
“It is acceptable if it is used to strengthen capital flow, and raise funds in the short and medium term when the capital chain is broken.”
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Hong Kong’s budget deficit is expected to balloon to HK$101.6 billion for the current financial year ending in March, almost double last year’s forecast given by the government. Chan said more borrowing would enable the government to maintain cash flow to finance major projects, such as the Northern Metropolis.
Tang, who served as finance chief from 2003 to 2007, ducked a question on whether Hong Kong had already plunged into a structural deficit as Tsang argued.
But he stressed that Chan had a duty to follow the principle stipulated in the Basic Law, the city’s mini-constitution, that the government needed to avoid deficits and keep expenditure within the limits of revenues.
“If you can be candid to citizens [about the dire financial situation], they can feel your respect and understand the rationale of the measures amid the challenges,” he said, referring to the city’s property downturn and soaring recurring expenditure.
Tang said that back in 2004 when he proposed issuing HK$20 billion in bonds, bankers described it as “a museum piece” as it was a rarely used tool then to solve the deficit problem.
Following measures to lure mainland Chinese tourists and launch renminbi business that year, he posted the city’s first budget surplus in five years in 2005.
Tang argued that Hong Kong was on the right track to revive its economy by finding new engines in technology and deepening cross-border integration.
Tsang’s remarks on the budget measures triggered heated debate on social media. He said that amid the high-interest rate environment, government bonds might not be as attractive to buyers as depositing their money in banks to secure higher rates of return.
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30,000 yuan in duty-free? Hong Kong CPPCC members want new cap for mainland visitors
He also worried that the city would eventually need to pay the debt’s interest expenses, which could affect its credit ratings, as well as saddle future generations with higher taxes and fewer public services.
On Monday, Tang also expressed support for the city’s coming national security legislation, a requirement under Article 23 of the city’s mini-constitution.
“Without stability, it’s hard to talk about economic development and livelihood improvements,” he said.
He added that countries, including Singapore, had been strengthening their own security legislation, urging the proposed law should be utilised effectively to gain investors’ confidence.
Written by Jitendra Parashar at The Motley Fool Canada
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Finance
Martha Aguirre, former El Paso ISD interim superintendent, resigns as CFO as district finds ‘key financial challenges’
El Paso Independent School District Chief Financial Officer Martha Aguirre, who served as interim superintendent last year, resigned this week as the district said it had discovered “key financial challenges.”
The district issued a news release late Thursday afternoon that lacked details but indicated that a recent review had raised questions about the district’s fund balances, a key indicator of financial health.
“Through this process, key financial challenges were identified that must be addressed prior to closing out the 2025-26 school year including a current budget shortfall that is being actively addressed ahead of the district’s final financial presentation to the Board of Trustees in June,” the news release said.
A CFO is charged with developing a school district’s budget and overseeing its finance department. The EPISD Board of Trustees must adopt a budget for the 2026-27 school year by the end of the fiscal year June 30. The operating budget for the current school year is $547 million.
EPISD Deputy Superintendent David Bates will oversee the budget while the district searches for an interim and permanent CFO, district officials said in a statement.
EPISD Board President Leah Hanany said trustees were notified about Aguirre’s resignation this week. She said the district plans to give the public more information on the current year’s budget during a board meeting later this month.
“The board was also notified of a potential budget shortfall for the 2025 budget, but we don’t have final numbers yet. My understanding is that we are still primed to pass a balanced budget for fiscal year 2026-27 in June,” Hanany said in a statement.
Aguirre could not be reached for comment. EPISD’s CFO makes $148,200 to $209,900 a year, according to the district’s administrative pay plan.
She served as EPISD’s interim superintendent from June to December 2025 after the district’s former superintendent, Diana Sayavedra, resigned under pressure from the board. She returned to her position as CFO when Brian Lusk was hired as EPISD’s new permanent superintendent.
Aguirre’s resignation comes amid an uncertain budget season after a state funding calculation error tied to school property tax breaks caused EPISD to lose out on $17 million in projected revenue. In late April, EPISD officials estimated it would cause the district’s spending to exceed its revenue next year by $10 million.
The district is also considering calling for a bond election in November to upgrade its aging campuses as part of the larger 2024 Destination District Redesign initiative to close schools and improve the ones that remain open.
El Paso Teachers’ Association President Norma De La Rosa said Aguirre’s departure was unexpected.
“We’re right in the middle of the committee meetings for a possible bond and getting ready to get that budget to the June board meeting for next school year. So, to say that I’m highly surprised is an understatement,” De La Rosa told El Paso Matters.
Aguirre started working with the district in 1996 as a general clerk, according to a video published by the district.
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