Protests take toll on HK’s Q4 growth
Economy is expected to contract; 97% of HK retail management association members incurring losses
HONG KONG: After a protest-filled festive season, the people of Hong Kong received more bad news.
The city's fourth-quarter growth is expected to contract as protests took their toll.
"Based on the situation of these few months, it is inevitable that negative growth will continue," Financial Secretary Paul Chan said in a blog post yesterday.
"This means the government will be less flexible in using financial resources under an economic recession."
He said the focus of his February Budget speech will be on jump-starting the economy, preventing more job cuts, helping businesses, as well as easing social distress.
Pro-democracy protests have hit Hong Kong's economy, hurting tourists arrivals and ravaging the retail sector, Bloomberg reported.
The number of people coming from China, the biggest group of tourists, plunged as did retail sales.
China arrivals fell a record 46 per cent in October to slightly more than 2.5 million, less than half of that in January.
Retail sales plunged 24.3 per recent data showed, the biggest fall ever, reported Bloomberg.
Hong Kong is in the midst of its worst downturn since the financial crisis, leading to more shops closing and number of layoffs growing.
The Hong Kong Retail Management Association said in a statement this month that as many as 97 per cent of its 63,000 members were incurring losses.
Almost a third of respondents to its survey are planning lay-offs, the Financial Times reported.
But there are some bright spots, including the Hong Kong financial market's core competitiveness, the dollar peg and the robust, free flow of capital, Mr Chan said yesterday.
He was backed up by Hong Kong's Chief Secretary for Administration Matthew Cheung.
He said what Hong Kong is known for such as the rule of law, clean government and a level playing field for businesseshas not changed.
The unrelenting economy-hurting protests continued yesterday.
Reuters reported that more than 1,000 people rallied in the rain in a park in the financial district yesterday, they chanted slogans for democracyand huddled under umbrellas.