Hong Kong's financial chief John Tsang started delivering the budget proposals for the fiscal year 2011-2012 at a Legislative Council meeting at 11:00 a.m. on Wednesday.
In his forth budget speech, Tsang said the city's GDP grew by 6.8 percent in 2010, surpassing the pre-tsunami level, mainly due to the strong growth in the mainland and other Asian areas.
"Our economy has fully recovered," Tsang said.
Meanwhile, the risk of rising inflation is mounting in the city. Tsang expected the underlying inflation for 2011 will average 4.5 percent.
"The soft U.S. dollar and possible sustained increase in global food and commodity prices will put more inflationary pressure on Hong Kong," Tsang said.
In his speech, Tsang announced the average inflation rate for 2010, as measured by the CPI index, was 2.4 percent, which was "rather moderate" taking into account the rapid economic expansion last year.