【Press Release】Friends of the Earth (HK) Response to the 2025-26 Budget: Bold climate action for a low-carbon and sustainable city

(Hong Kong, February 26, 2025) The Financial Secretary announced the 2025-26 Budget today. Friends of the Earth (HK) welcomes the extension of the Pilot Green and Sustainable Finance Capacity Building Support Scheme for training local green finance talents, and the allocation of HK$180 million to increase residential food waste collection and expand the recycling network. Still, the budget did not include sufficient policies on climate mitigation and adaptation. Climate change and other environmental issues won’t pause due to a fiscal deficit. Furthermore, leveraging the low-carbon transition would help to create new jobs and drive economic growth. The government must unlock the resource needed to facilitate the sustainable development of Hong Kong.

Friends of the Earth (HK) urges the government to adopt the following recommendation:

Decarbonising Hong Kong’s major emitters

• Review electricity contracts for renewable energy adoption: The Scheme of Control Agreements (SCAs) presents a clear opportunity for clean energy transition. Hong Kong should begin reviewing for the next SCAs, setting targets to phase out fossil fuels, and leveraging its international financial centre status to invest in renewable energy projects.
  
  
• Expedite zero-emission transport transition: Hong Kong should accelerate electrification efforts for transport, scaling up the trialing and use of alternative energy options for transport. The city should also support the development of infrastructure for alternative fuels such as hydrogen and sustainable aviation fuels.
  
  

Making Hong Kong more climate resilient

• Adopt nature-based solutions (NbS) in urban planning: NbS offer sustainable and effective approaches to addressing environmental challenges (such as heat island and flooding) and enhancing climate resilience. Hong Kong should increase its adoption in urban planning and design, and streamline the current tree management staffing model for better urban forestry management.
  
  
• Establish an authority to lead climate actions: Hong Kong needs a dedicated office to coordinate and implement climate strategies across government departments and all sectors of society. This office would set science-based targets, manage funding for climate initiatives, and oversee progress towards the city’s climate goals.

Building up Hong Kong’s recycling capacity

• Enhance collection and recycling channels: Hong Kong must support the development of other collection channels beyond the Green@Community network to ensure ease of recycling. At the same time, it should reduce waste at source, such as referencing France in formulating regulations to ban supermarkets from discarding unsold food, and work with food businesses to facilitate the redistribution of surplus food.
  
  
• Expand coverage of producer responsibility: Producer Responsibility Schemes (PRS) are vital for fostering a circular economy by holding producers accountable for the end-of-life management of their products. Hong Kong should expedite the implementation of a comprehensive PRS to cover all single-use beverage packaging formats, packaging waste, and food waste.

Solidifying Hong Kong’s green finance hub position

• Extend and expand green finance capacity building programmes: Hong Kong should be more proactive in building up local green finance capacity. The city should expand the funding scope of the Continuing Education Fund to cover all sustainability courses eligible under the Pilot Green and Sustainable Finance Capacity Building Support Scheme.
  
  
• Promote taxonomy equivalence for market efficiency: Hong Kong is in a unique position to reduce compliance costs and improve market access by facilitating taxonomy equivalence between major sustainable finance frameworks. Prioritising this initiative would strengthen the city’s role as a green finance hub and support efficient capital allocation for sustainability initiatives across the region.
  
  
• Strengthen taxonomy implementation support across sectors: Hong Kong should develop sector-specific implementation guides and provide capacity building and training to help financial institutions and businesses effectively align with the "Hong Kong Taxonomy for Sustainable Finance”.

A world-class international city should be a zero-carbon, climate resilient city. The government must proactively address climate change, accelerate waste reduction efforts, and strive to achieve sustainability. Through collaborative efforts, we can strive together to construct a more environmentally conscious Hong Kong.

Encl. Friends of the Earth (HK) Response to the 2025-26 Budget Consultation