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Empowering communities through economics
Agastya Rekhi, South Island School
Nothing is more important to me than making a difference and giving back to the community that has shaped me over the years.
A few years ago, I volunteered with an organisation dedicated to supporting refugees. This experience was life-changing for me and prompted me to reflect on my relative privilege. I became interested in the levels of financial literacy in Hong Kong, particularly among refugees and other minority groups, and decided to use my economics education to address this issue. It has been a few years since then, and I am now running two organisations focused on improving financial literacy in Hong Kong.
I am the founder of Launchpad, an organisation that teaches economics and business skills to students, particularly those from underprivileged backgrounds. We have conducted around 60 sessions and taught approximately 120 students so far. We have chapters in Hong Kong and India, and we are currently working on establishing a chapter in the United Kingdom.
Our programmes are designed for both primary and secondary students, with age-appropriate sessions. Economics is not a subject commonly taught or well received in our society; some people find it boring, while others consider it too technical. To address these misconceptions and broaden our reach, I have focused on breaking down complex concepts into easily understandable activities.
I also run a newsletter called “The Bottom Line”. Our goal with “The Bottom Line” is to create a monthly newsletter that simplifies the economic implications of the stories we encounter in the news and promotes financial literacy. The news we read can significantly impact our lives, so we aim to present these stories in straightforward terms, making them easily accessible.
The idea for “The Bottom Line” originated from my helper in Hong Kong. After learning that I was studying economics, she frequently asked me how the news stories she read would affect her. Coming from an impoverished family in the Philippines, she lacked financial education and often struggled to understand the complex connections between economics, politics and real-world outcomes.
I recognised a significant need in Hong Kong for a service like this and decided to create “The Bottom Line” to make a meaningful impact. My team and I produce a simple newsletter each month that explains how the stories people read affect their lives. We currently have over 2,000 subscribers, including both students and adults.
Crafting the newsletter is challenging; it requires extensive research and creative activities to engage our readers.
However, receiving positive feedback from my audience and hearing how “The Bottom Line” has benefited them makes it all worthwhile.
Uncovering Japanese politics
Duncan Cheung, The IMC of Shatin Tsung Tsin Secondary School
Sanae Takaichi’s decisive victory in Japan’s recent snap election has provided her Liberal Democratic Party (LDP) with a historic supermajority in the House of Representatives, securing 316 out of 465 seats. This supermajority grants the government significant political stability and the ability to implement policies effectively and decisively.
At the core of her platform is “Sanaenomics”, a term coined by the media to describe her economic policies. This shift towards proactive fiscal stimulus focuses on strategic investments rather than efforts to reduce government spending.
Key measures include a two-year suspension of the 8 per cent consumption tax on food and drink to alleviate inflation-driven living costs, free high school tuition, free elementary school lunches and an increase in the income tax threshold to ease burdens on lower earners.
Takaichi has outlined 17 key sectors, including artificial intelligence (AI), quantum computing, fusion energy and semiconductors. These sectors represent areas where public-private partnerships will focus resources to strengthen economic security and decrease reliance on China.
Defence spending is a critical priority, with plans to reach 2 per cent of gross domestic product (GDP) due to regional tensions. The recently approved budget for the coming financial year reflects these priorities.
It increases defence allocations while also funding social security, education and innovation initiatives.
What is the reasoning behind Takaichi’s policies? Takaichi believes that prioritising the stimulation of Japan’s technology industry can lead to GDP growth, which is expected to grow about 1.3 per cent in real terms for the coming financial year. This boost could offset additional spending and revive Japan’s long-stagnant economy.
However, this approach carries some risks. Japan’s public debt already exceeds 230 per cent of GDP, making it one of the highest in the world. Debt-servicing costs in the new budget are estimated to surpass 30 trillion yen (US$192 billion or HK$1.5 trillion) in the coming financial year. The proposed suspension of the food tax alone could reduce annual revenue by 5 trillion yen, which could widen deficits if economic growth falters.
Last month, Japan’s 10-year bond yields hit a 27-year high, indicating market caution about fiscal expansion. This situation may force the government to raise interest rates to maintain market confidence, thereby increasing costs.
On a positive note, investor sentiment has been strong. Japan’s stock market index reached new all-time highs in early February, signalling confidence in Takaichi’s growth-oriented policies.
Success could revitalise Japan’s stagnant economy, strengthen its technological advantage and enhance national security. However, failure could lead to increased interest burdens, forced cuts in welfare or pensions, a bond market crash and even hyperinflation if Japan prints money to repay bonds.
