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KPMG: Government reserves remain robust, advocates for expanded asset management and innovation industries to boost economic growth
Resilient response to challenges, highlighting AI and Northern Metropolis
HONG KONG SAR – Media OutReach Newswire – 28 February 2025 – KPMG welcomes the Hong Kong Government’s Budget, recognising it as a well-considered strategy that balances the needs of society with economic development goals. The Budget focuses on key areas such as Artificial Intelligence (AI), infrastructure investment, and innovative industries, creating new opportunities for high-quality economic growth in Hong Kong while further strengthening its international competitiveness.
The Hong Kong SAR Government has revised its 2024/25 Budget, projecting a consolidated deficit of HKD 87.2 billion. By the end of March 2025, Hong Kong’s fiscal reserves are expected to reach HKD 647.3 billion, closely aligning with KPMG’s estimates of HKD 89.7 billion deficit and HKD 645 billion in reserves, indicating that fiscal reserves remain relatively robust. The projected GDP growth rate for 2025/26 has been adjusted to between 2% and 3%, down from the previous year’s forecast of 3.2%. KPMG attributes this revision to ongoing geopolitical uncertainties and a slower-than-expected decline in interest rates. To address these challenges, KPMG recommends that the government allocate more resources to high-growth sectors such as asset management and innovation, aiming to stimulate economic growth in Hong Kong and deliver benefits to the general public.
John Timpany, Head of Tax in Hong Kong, KPMG China, says: “In the Budget, the HKSAR Government has clearly positioned AI as the core driver for cultivating new quality productive forces, and is promoting its development through a series of policy measures, fully demonstrating Hong Kong’s ambition as an international innovation and technology hub. We are pleased to see the Government leveraging the advantages of ‘One Country, Two Systems’ to actively establish Hong Kong as an international exchange hub for the AI industry, and strengthening the integration of scientific research and industrial applications through projects such as Cyberport’s AI Supercomputing Centre, Hong Kong Microelectronics Research and Development Institute, and the soon-to-be-established Hong Kong Artificial Intelligence Research and Development Institute. This not only creates opportunities for local technology companies but also injects new momentum into the transformation and upgrading of traditional industries, narrowing the gap with other leading jurisdictions.”
Stanley Ho, Tax Partner, KPMG China, says: “To ensure the strategic infrastructure projects stay on schedule, KPMG believes that raising capital by issuing government bonds at a moderate pace is a wise move. We support the government’s commitment to using bond proceeds exclusively for infrastructure investments, ensuring they are not directed towards recurring government expenditures. This disciplined approach, outlined in the new bond program, should keep the government debt-to-GDP ratio at a manageable level and protect Hong Kong’s credit rating. We encourage the government to proactively explore ways to make infrastructure projects more cost-effective. Embracing technological innovations and encouraging public-private partnerships are two promising avenues for expense optimisation.”
Alice Leung, Tax Partner, KPMG China, says: “We welcome the Financial Secretary’s proposal to expand the classes of investments permitted under the family office tax regime. To make Hong Kong even more attractive to family offices, it makes sense to include digital assets and art as eligible investments. These are already common asset classes for family offices, so adding them to the regime could encourage more family offices to set up in Hong Kong. This would be a win-win, creating jobs and boosting demand across a range of professional services. Additionally, it is encouraging to see the government actively pursuing tax treaties with 17 jurisdictions – this is a significant step in supporting Hong Kong taxpayers investing overseas. We also applaud the government’s initiative to attract more commodity trading activity to Hong Kong through a competitive 8.25% tax rate. These measures will inject vitality into the local market, enhance liquidity, and further solidify Hong Kong’s role as an international financial centre.”
Chi Sum Li, Head of Government & Public Sector in Hong Kong SAR, KPMG China, said: “We support the government’s prioritisation of investment in developing the Northern Metropolis. The focus on key industries such as innovation and technology, high-end professional services, modern logistics, tertiary education, cultural, sports, and tourism in the area demonstrates a commitment to a diversified development blueprint. Meanwhile, the accelerated progress of projects like Kwu Tung North / Fanling North, along with the implementation of transport infrastructure including the Northern Link and Hong Kong-Shenzhen Western Railway, will enhance connectivity in the region and lay a solid foundation for commercial and innovation technology development. We believe the development of the Northern Metropolis will inject new vitality into Hong Kong’s economy and create better living and career prospects for citizens.”
In terms of nurturing and attracting talent, KPMG welcomes the government’s proposal to enhance the “New Capital Investment Entrant Scheme”. It is encouraging to know the scheme has already received over 880 applications with an expected HKD 26 billion in investments. We suggest lowering the residential property price threshold from HKD50 million to HKD 30 million. This would open up the scheme to a broader range of talents looking to invest in Hong Kong real estate and we don’t anticipate this change having a major impact on housing affordability for the general public. Additionally, the government can consider shortening the current seven-year waiting period for permanent residency applicants, to make the scheme even more attractive.
Amid fiscal constraints, the government has taken measures to control expenditure growth. For 2026/27 and 2027/28, the Financial Secretary announced a 2% annual reduction in the civil service, with an estimated reduction of approximately 10,000 positions by April 1, 2027. Additionally, a salary freeze for all personnel across the executive, legislative, judicial branches, and district councils has been proposed for 2025/26. KPMG believes that job cuts and the salary freeze are signals to the public that the government is closely monitoring its spending, as taxpayers would expect during a period of fiscal deficits. This demonstrates the Hong Kong government’s commitment to prudent management of public finances.
In light of the fiscal deficit and the aging population, KPMG supports the government’s proposed optimisation of the “HKD 2 Public Transport Fare Concession Scheme.” The proposal maintains eligibility for individuals aged 60 and above but introduces a monthly cap of 240 trips. Additionally, for fares of HKD 10 or more, the subsidy will be adjusted to a 20% discount of the full fare. These measures aim to balance the travel needs of the elderly and the silver economy with smarter use of public funds. At the same time, this will enable the government to more accurately forecast related expenditures in the future.
Hashtag: #KPMG
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About KPMG
KPMG in China has offices located in 31 cities with over 14, 000 partners and staff, in Beijing, Changchun, Changsha, Chengdu, Chongqing, Dalian, Dongguan, Foshan, Fuzhou, Guangzhou, Haikou, Hangzhou, Hefei, Jinan, Nanjing, Nantong, Ningbo, Qingdao, Shanghai, Shenyang, Shenzhen, Suzhou, Taiyuan, Tianjin, Wuhan, Wuxi, Xiamen, Xi’an, Zhengzhou, Hong Kong SAR and Macau SAR. It started operations in Hong Kong in 1945. In 1992, KPMG became the first international accounting network to be granted a joint venture licence in the Chinese Mainland. In 2012, KPMG became the first among the “Big Four” in the Chinese Mainland to convert from a joint venture to a special general partnership.
KPMG is a global organisation of independent professional services firms providing Audit, Tax and Advisory services. KPMG is the brand under which the member firms of KPMG International Limited (“KPMG International”) operate and provide professional services. “KPMG” is used to refer to individual member firms within the KPMG organization or to one or more member firms collectively.
KPMG firms operate in 142 countries and territories with more than 275, 000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. Each KPMG member firm is responsible for its own obligations and liabilities.
Celebrating 80 years in Hong Kong
In 2025, KPMG marks “80 Years of Trust” in Hong Kong. Established in 1945, we were the first international accounting firm to set up operations in the city. Over the past eight decades, we’ve woven ourselves into the fabric of Hong Kong, working closely with the government, regulators, and the business community to help establish Hong Kong as one of the world’s leading business and financial centres. This close collaboration has enabled us to build lasting trust with our clients and the local community – a core value celebrated in our anniversary theme: “80 Years of Trust”.
Media OutReach
CyCraft Named a Sample Provider in the Gartner® Latest AI Reasoning Models Report—The Only Taiwan-Based Cybersecurity Provider Listed
Dr. Benson Wu, CEO and Co-Founder of CyCraft, stated: “We believe, being listed as a Sample Providerin the Gartner report demonstrates that the global market now views AI security as the next battlefield for AI commercialization. From day one, CyCraft has developed proprietary models, simultaneously deploying AI reasoning capabilities across three core pillars: cybersecurity defense, AI governance, and unmanned vehicle reconnaissance. Technical leadership is our starting point, not the destination. Our goal is to translate this leadership into rapid growth driven by strategic deployment and disciplined execution. Launched this year, our AI Red Teaming and AI Guardrail solutions have already been productized and commercially shipped, seeing active deployment in sectors like semiconductors and sovereign AI.”
AI Reasoning Models Drive Up Operating Costs, Restructuring Profit Logic
As AI transitions from “training models” to “reasoning models,” the industry officially moves from the research and development phase into commercial application. Reasoning models possess logical deduction, self-reflection, and complex problem-solving capabilities. However, these advanced capabilities have caused AI operational costs to skyrocket, forcing the tech industry to redefine its expectations of AI as a tool for massive cost reduction and profit maximization.
CyCraft’s XCockpit Threat Exposure Management Platform features built-in AI reasoning models that triage thousands of alerts in real time, automatically providing mitigation recommendations and effectively eliminating alert fatigue. From overall security posture scoring to specific actionable tickets for individual alerts, XCockpit transforms defensive benefits—which were historically difficult to define—into concrete, quantifiable technical metrics. This embodies CyCraft’s pragmatic philosophy: the value of defense must be visible, and it must be measurable.
Standing at the Frontier of AI Security, CyCraft Advances Commercial Implementation with Profound R&D Momentum
Deeply integrating AI with cybersecurity, CyCraft has launched XecGuard and XecART—two major AI security products deployable across both cloud and on-premises environments, both featured on the OWASP AI Security Map. These solutions directly address the core pain points of Agentic AI, LLM, and GenAI applications. XecART utilizes Agentic Red Teaming to run multi-round stress tests on models, identifying risks and generating compliance reports that adhere to international standards. Meanwhile, XecGuard acts as a real-time Guardrail for LLMs and AI Agents, intercepting anomalous inputs and outputs. One solves “how to stress-test AI,” while the other solves “how to protect AI,” providing the fundamental AI governance for enterprises.
CyCraft’s research achievements are equally outstanding. The CyCraft research team recently presented at the International Conference on Machine Learning (ICML), one of the world’s top three prestigious academic conferences for AI and machine learning. The research focused on Retrieval-Augmented Generation (RAG) Data Poisoning. Utilizing their self-developed “Eyes-on-Me” attack framework, the team proved that attacks can simultaneously breach both the retrieval and generation phases. The end-to-end average attack success rate surged from 21.9% to 57.8%. This breakthrough exposed a long-neglected vulnerable attack surface existing between “attention focus” and “model output.”
In 2025, the CyCraft research team was also selected for NeurIPS, one of the most iconic academic sanctuaries in the AI field. The team proposed an innovative “unified supervision framework” that embeds verifiable checkers into synthesized instruction-conflict instances, enabling self-supervised learning without requiring oracle labels or reasoning traces. This framework not only applies to different models but also significantly enhances both safety robustness and instruction adherence.
CyCraft believes that as AI moves from R&D to commercial deployment, the barrier for enterprises is no longer “whether they can use AI,” but “whether they can use AI responsibly.” Once Agentic AI enters financial transactions, government services, or critical infrastructure, every autonomous decision must leave a traceable path, accept auditing, and allow for real-time human intervention when necessary. This is true AI governance. It is not a compliance document, but a complete control chain stretching from pre-launch to runtime, and onto post-incident traceability.
CyCraft deconstructs this control chain into three actionable phases: XecART stress-tests model risks before deployment; XecGuard safeguards inputs and outputs during runtime; XCockpit quantifies the overall risk posture into traceable metrics. Interlocking these three components ensures that every step AI takes is visible, manageable, and auditable. CyCraft’s objective is clear: make AI behavior measurable before its value can be priced. Ultimate technical leadership must be converted into commercial resilience that is governable, auditable, and open to investor scrutiny.
The technological revolution of AI Reasoning Models and Agentic AI is an undeniable reality. The ultimate challenge lies in whether enterprises can implement “controllable, auditable, and highly transparent” AI governance within real-world commercial environments. From being recognized in international research reports to taking the stage at top-tier academic conferences, CyCraft continues to prove that from visionary R&D to product commercialization, Taiwan’s AI cybersecurity prowess helps herald the future of a secure, trusted, and prosperous AI era.
Reports
Gartner, Emerging Tech: AI Vendor Race: Reasoning Models Reshape Providers’ Approaches to AI Pricing, 5 June 2026.
Disclaimer
Gartner does not endorse any company, vendor, product or service depicted in its publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner publications consist of the opinions of Gartner’s business and technology insights organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this publication, including any warranties of merchantability or fitness for a particular purpose. GARTNER is a trademark of Gartner, Inc. and its affiliates.
Hashtag: #CyCraftTechnology
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About CyCraft
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Enshi Suobuya Stone Forest in China Launches Rich Cultural Experiences to Welcome Southeast Asian Tourists
Geological Wonder: Exploring an Ancient Underwater World from 460 Million Years Ago
Located in Taiyanghe Township in the northwest of Enshi City, Suobuya Stone Forest is approximately a one-hour drive from the city center. The scenic area was formed during the Ordovician Period 460 million years ago. Originally covered by an ancient ocean, it gradually evolved through geological transformations over hundreds of millions of years into the extraordinary stone forest landscape seen today. Covering a total area of 21 square kilometers, the area features towering stone peaks surrounded by lush greenery, resembling a vast “underwater labyrinth.” As a “crowned stone forest” with one of the highest vegetation coverage rates in China, the scenic area enjoys a cool and pleasant average summer temperature, making it an ideal destination for summer retreats and nature-based relaxation.
The four major scenic areas currently open to visitors each have their own unique appeal. Qinglongtai serves as the highest point of the scenic area, offering panoramic views of the entire stone forest from above. Lianhuazhai features the breathtaking “Xiniugou” secret landscape, where towering cliffs on both sides and changing light and shadows create a dreamlike atmosphere. Mozigou is rich in ancient biological fossils, allowing visitors to touch traces of life from the Ordovician Period with their own hands. Jiulonghui features circular rock walls and groups of waterfalls, with stone peaks rising dramatically from the ground to create a magnificent landscape. The scenic area also features the 5D theater “Shanhaijing,” where visitors can enjoy an immersive experience of the evolution of the Ordovician ocean world. With gentle walking trails and an easy travel route, the area is suitable for families and nature exploration enthusiasts.
Cultural Feast: Immersive Experiences of Tujia Folk Traditions
Suobuya Stone Forest is not only a treasure trove of geological wonders but also an important carrier of Tujia culture. The Tujia ethnic group is one of the major ethnic minorities in the Enshi region, with a long history and distinctive cultural traditions. The “Baishou Dance” is one of the most representative folk dances of the Tujia people and has been listed as a National Intangible Cultural Heritage. The dance movements often imitate scenes such as hunting, farming, and warfare, featuring a lively rhythm. Visitors can personally participate in this cultural experience at the Tiejiazhai Square and Duigetai Stage.
The Tujia Girls’ Festival is one of Enshi’s most distinctive traditional folk festivals and has been held at Suobuya Stone Forest during the seventh month of the lunar calendar for many consecutive years. The festival is a traditional social activity where young Tujia men and women use songs as a medium for communication and dances to express emotions. It carries the unique marriage customs and collective memories of the Tujia people and has been recognized as a provincial-level intangible cultural heritage of Hubei Province and one of the “Top Ten Most Charming Festivals in China.” During the festival, the scenic area hosts a variety of activities, including matchmaking through folk songs, traditional cultural parades, and traditional handicraft exhibitions, allowing visitors to experience the rich ethnic culture amid the stone forests and mountain scenery. Suobuya Stone Forest has therefore also been recognized as the “Hometown of Chinese Folk Art” and the “Hometown of Mountain Folk Songs.”
Since 2026, the scenic area has continued to enhance its tourism products and cultural experiences. During the May Day holiday, it launched the “Exploring Wonders on Horseback · Fun in the Million-Year Stone Sea” folk culture series, featuring interactive programs such as folk song and dance flash mobs, the “Nature Guardians” activity where visitors exchange collected litter for cultural souvenirs, the immersive intangible cultural heritage experience “Stone Workers’ Chant,” and the outdoor role-playing game “Stone Forest Secret Order · Pursuing the Shadow of Rocks.” These activities allow visitors to explore the ancient stone sea while deeply engaging with Tujia cultural traditions.
Improved Transportation: Easier Access to Enshi for Southeast Asian Tourists
Since the opening of Enshi Xujiaping International Airport’s aviation port, the international flight network has continued to improve. In 2026, the Enshi–Hong Kong route achieved year-round regular operation, while flights between Enshi and Vietnam’s Ho Chi Minh City and Hanoi have resumed successively, creating a dual-route network connecting Vietnam’s two major cities in the north and south. According to the development plan of the Enshi aviation port, new routes to Singapore, Kuala Lumpur in Malaysia, and other destinations will be steadily promoted in the future, further strengthening the Southeast Asian aviation network. Tourists from major Southeast Asian cities can fly directly to Enshi and reach this 460-million-year-old underwater world after only a one-hour drive. Hidden deep within the Wuling Mountains, this ancient stone forest wonderland is welcoming visitors from around the world with a more open and international approach.
Hashtag: #SuobuyaCulturalTourism
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When a Stay Goes Beyond Check-out: Amari Unveils “Ari Service” to Deepen Guest Connections with Every Destination
As ONYX Hospitality Group celebrates its 60th anniversary, the company is entering a new chapter of growth through the continued evolution of its brand portfolio. As part of this journey, Amari has been revitalised with a refreshed brand positioning centred on authentic local connections and warm Thai hospitality. Bringing this vision to life is the introduction of “Ari Service”, a new signature brand touchpoint designed to deepen the relationship between guests and the destinations they visit. Through thoughtful, locally inspired interactions and personalised service, Ari Service encourages guests to discover the character, culture and people of each location, creating meaningful experiences that extend well beyond check-out and reinforcing Amari’s promise of creating lasting memories.
As travel today is no longer simply about changing places, but about taking time for oneself, being with loved ones and creating meaningful moments, Amari believes that the best journeys continue long after check-out. Every stay is designed to leave guests with feelings and experiences they can carry home, from the first warm welcome upon arrival and a local dish that brings back memories of a destination, to moments shared with loved ones and thoughtful details that make guests feel truly understood and cared for.
Beyond thoughtful service, Amari connects guests with the unique character of each destination through locally inspired design, food and ingredients that reflect the identity of each place, and experiences that connect guests with local communities, culture and ways of life. From beachfront escapes surrounded by nature to vibrant city stays, every Amari destination reflects its own sense of place, offering experiences that are warm, lively and memorable.
At Amari Phuket, guests can experience a relaxing seaside escape along the Andaman coast, where the island’s natural beauty, local culture, cuisine and heritage come together. From unwinding at Breeze Spa, an open-air spa experience complemented by the sound of the waves, to discovering Phuket’s local flavours, historic Old Town and coastal lifestyle, every moment offers a deeper connection with the rhythm of the island.
Amari Vogue Krabi offers a tranquil retreat at Tubkaek Beach, one of Krabi’s most scenic coastal destinations. Surrounded by nature and overlooking the Andaman Sea, guests can enjoy peaceful moments by the beach, breathtaking sunsets and the simplicity of coastal life, making it an ideal destination to reconnect with themselves and loved ones away from the pace of everyday life.
For travellers seeking a more vibrant seaside escape, Amari Pattaya combines relaxation with the energy of one of Thailand’s most dynamic coastal cities. Guests can begin their day with moments of relaxation and holistic well-being at maai spa before exploring Pattaya’s cafés, restaurants, seaside activities and lifestyle experiences. With its balance of comfort and liveliness, Amari Pattaya offers a welcoming destination for families, couples and leisure travellers.
In the heart of Bangkok, Amari Bangkok combines the convenience of a city location with a warm and relaxing atmosphere where guests can unwind amidst the energy of the capital. With easy access to shopping, lifestyle destinations, cultural attractions, restaurants and key city landmarks, the hotel serves as both a gateway to discovering Bangkok from a new perspective and a welcoming place to return to for comfort and thoughtful care.
For Amari, a memorable journey does not end when guests leave the hotel. It continues through the feelings, connections and experiences they take home. By bringing each destination’s unique character to life through Ari Service, authentic local experiences and genuine Thai hospitality, Amari creates meaningful moments that become lasting memories. These are the “Endless Memories” that Amari strives to create at every destination, making every journey even more meaningful.
For more information on Amari please visit: www.amari.com
Hashtag: #ONYXHospitalityGroup
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About ONYX Hospitality Group
ONYX Hospitality Group, a reputable force in the Asia-Pacific hospitality industry, operates a collection of comprehensive yet complementary brands – Amari, OZO, Shama and Oriental Residence – catering to the distinctive needs of discerning business and leisure travellers across the region where it has deep expertise. In addition to its brand portfolio, ONYX Hospitality Group also operates additional hospitality services across spa and food & beverage. With six decades of management experience, the company extends its innovative solutions throughout the region, upholding internationally recognised standards and ensuring optimal operational manoeuvrability. By fostering enduring relationships with like-minded business partners, ONYX Hospitality Group delivers unparalleled experiences in a dynamic and competitive market, meeting the ever-evolving demands of travellers.
More information: www.onyx-hospitality.com
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