Lex: Asian budget handouts
The world may applaud the rise of Asia’s middle-class, but it is still sometimes a pretty miserable place to be.
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Hong Kong’s self-styled “sandwich class” has, at various times over the past few decades, been squeezed out of the housing market; seen savings eroded by inflation; and, once affordable property came along, suffered negative equity.
This week, however, was sweet for the middle classes. Singapore doled out handouts to lower and middle-income citizens in its annual budget, even going into a rare deficit in order to do so. Hong Kong followed by unveiling salary tax cuts in its budget yesterday. But the handouts were not of sufficient magnitude to boost consumption or property markets. So what explains the sudden largesse?
Singapore’s US$1.6bn cash give-away
