Guarding Against Fiscal Risks in Hong Kong SAR

 
Author/Editor: Porter, Nathaniel John
 
Publication Date: July 01, 2007
 
Electronic Access: Free Full text (PDF file size is 324KB).
Use the free Adobe Acrobat Reader to view this PDF file

 
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: Hong Kong SAR's government faces the dual challenges of volatile revenue and medium term spending pressures arising from a rapidly aging population. Age-related spending pressures raise long-run sustainability concerns, while revenue volatility creates risks to service provision, possibly entailing sudden tax changes, or even requiring new borrowing. After describing the risks associated with aging, the paper uses value at risk techniques to measure the value of the unanticipated risks posed by volatile revenue. The paper also describes the self-insurance value of Hong Kong SAR's traditionally high fiscal savings (reserves), and the impact alternate policy choices could have on revenue volatility.
 
Series: Working Paper No. 07/150
Subject(s): Risk management | Hong Kong SAR | Fiscal policy | Tax revenues | Government expenditures | Aging | Hong Kong Special Administrative Region of China

Author's Keyword(s): Fiscal Policy | Revenue Volatility | Value at Risk
 
English
Publication Date: July 01, 2007
ISBN/ISSN: 1934-7073 Format: Paper
Stock No: WPIEA2007150 Pages: 19
Price:
US$18.00 (Academic Rate:
US$18.00 )
 
 
Please address any questions about this title to publications@imf.org