Hong Kong will transfer 150 billion Hong Kong dollars to the Capital Works Reserve Fund to support infrastructure projects in the northern metropolitan area and other projects.

The Hong Kong government announced today (April 14) that the Chief Executive, together with the Executive Council, has approved the transfer of HK$150 billion from the Exchange Fund to the Government's Capital Works Reserve Fund in accordance with Section 8 of the Exchange Fund Ordinance. The transfer will be made through a designated account under the Financial Secretary Limited and will be transferred to the Capital Works Reserve Fund account in two installments of HK$75 billion each annually in the fiscal years 2026-27 and 2027-28. The Hong Kong government will implement the relevant arrangements after the Legislative Council passes the 2026 Appropriation Bill. A government spokesperson stated that Section 8 of the Exchange Fund Ordinance empowers the Financial Secretary to transfer funds from the Exchange Fund and determine the relevant mechanisms, with the primary condition being that the Financial Secretary must ensure that the transfer does not adversely affect the stability of the Hong Kong dollar exchange rate maintained by the Exchange Fund and the stability and soundness of the local currency and financial system. In the 2026-27 Financial Budget presented by the Financial Secretary of the Hong Kong Special Administrative Region, it was highlighted that the investment performance of the Exchange Fund last year reached a historic high, with total investment income of HK$330 billion for the year. As of the end of last year, the total assets of the Exchange Fund exceeded HK$4.1 trillion, a scale sufficient to maintain the stability of the Hong Kong currency and financial system. It is proposed to transfer HK$150 billion from the Exchange Fund to the Government's Capital Works Reserve Fund over two years to support infrastructure projects in the Northern Metropolis Area and other projects, without affecting the stability and soundness of the Hong Kong currency and financial system. A government spokesperson emphasized that this transfer is a special arrangement and not a regular measure. All funds will be used for infrastructure projects rather than government operating expenses, with the aim of accelerating development capacity, making it a long-term investment. The Hong Kong government has consulted the Exchange Fund Advisory Committee on the transfer proposal and received its support.