HK shops shutter as months of protests darken economic gloom
Months of violent protests taking their toll on businesses in the city
HONG KONG: Jeweller Jun Lam has already closed one shop. His remaining outlet sits in an almost deserted shopping mall at the heart of a district regularly hit by sometimes violent protests that have rocked the Chinese-ruled city since June.
Restaurants, hotels and retail outlets such as Mr Lam's, many of which cater to mostly Chinese tourists, form a central pillar of a small business sector that employs more than one million people.
But with visitors deterred by months of violence, many firms have closed or are struggling to turn a profit.
"It is only a third of the pedestrian flow compared with the past. On some days, almost no shops were open in this mall," Mr Lam said.
To stay afloat, he has closed his other store in the New Territories district of Tsuen Wan, the site of some violent demonstrations between protesters and police.
When Reuters visited The Capital mall, where Mr Lam's remaining shop sits, almost half the units were closed or emptied.
In the surrounding Tsim Sha Tsui shopping and hotel precinct, many shutters on closed shops bore "To Let" signs or letters from landlords demanding rent.
On Sunday, the district was blanketed in tear gas during cat-and-mouse clashes between police and pro-democracy protesters.
It was the 21st consecutive weekend of protests over fears that Beijing is tightening its grip on the territory, the worst political crisis since Britain handed Hong Kong back to China in 1997.
The unrest has dealt a double blow to the financial hub, which was already grappling with sluggish economic growth.
Hong Kong's embattled leader Carrie Lam said yesterday that she expects negative economic growth for the full year.
Ms Lam was speaking two days after Financial Secretary Paul Chan said Hong Kong has fallen into recession and was unlikely to achieve any growth this year.
"Our current assessment is that the full year of 2019 will likely show negative growth, which means we won't be able to achieve the already revised down positive growth of 0-1 per cent," Ms Lam said. "The situation is very grim."
A preliminary estimate for third-quarter gross domestic product tomorrow is expected to show two successive quarters of contraction - the technical definition of a recession.
Larger firms impacted by the protests can often fall back on their wider footprint, access to emergency capital or international business, industry watchers say, but for many small firms there is no such safety net. - REUTERS