Unusual developments in the finance industry are nothing new. In Hong Kong, the concept of “helicopter money” is seemingly getting out of hand.
A new decree will see all adults in Hong Kong receive a HK$10,000 cash handout.
Helicopter Money in Hong Kong
This will be provided to all permanent Hong Kong residents over the age of 18.
Reasoning behind this move comes in the form of boosting local consumption and spending.
Furthermore, the government wants to ease economic turmoil in light of a fiscal deficit.
Handing out free cash to all residents will cost HK$71 billion, or $9,110,684,500.00.
It is quite a development that sparks many debates regarding “helicopter money” policies in the financial world.
For the local government, covering the costs will be done through the nation’s fiscal reserves.
There will also be a salary tax cut of 100% for the 2019-2020 period up to HK$20,000.
Stabilizing the economy in Hong Kong is of great importance to government officials.
Handing out free cash to all adults may not necessarily be the best option to explore, however.
Waiving a month of rent for lower-income tenants in government public housing is another unusual measure to be deployed.
This new development may very well create a precedent for other countries to follow, either for better or worse.