Hong Kong Financial Secretary Paul Chan (陳茂波) yesterday said the territory could be hit by its worst economic slump on record, even as authorities prepare to ease some lockdown measures amid signs the COVID-19 outbreak has been contained.
Reiterating a forecast for a contraction of 4 to 7 percent this year, Chan said in a blog post that the low end of that estimate would be the deepest drop since records began in the 1960s.
A report on Hong Kong’s economy to be released today is estimated to show a 6.4 percent contraction in the first quarter from the end of last year, a Bloomberg survey showed.
Photo: Bloomberg
“The city is taking a hit from violent vandalism and the pandemic,” Chan wrote. “First-quarter GDP is expected to be worse and it’s a third straight quarter of contraction, which is worrying.”
With the global economy facing its biggest headwinds since the 1930s, it is difficult to see a significant rebound in the territory’s main growth engines of domestic demand, exports and investments, Chan said.
Hong Kong’s economy was already reeling after months of sometimes violent protests.
Photo: Reuters
Now with the outbreak under control — with several days of no new cases reported over the past two weeks — the territory is again facing fresh political unrest.
Taking cautious steps to get back to work, Hong Kong today is reopening government offices and some public facilities. Government employees are to start returning to offices and the territory is preparing to open facilities, including museums and libraries, that have been closed during the pandemic.
Authorities have yet to decide whether to extend social distancing measures beyond Thursday.
In other developments, China’s Liaison Office in Hong Kong accused protesters of jeopardizing the future of the territory, calling demonstrations on Friday “illegal activities,” in the latest signal that China’s top agency in the territory intends to take a more hands-on role.
In a statement published on Saturday on its Web site, the office said “extremist radicals” were involved in illegal gatherings, harassment of shops and throwing of gasoline bombs.
It accused them of trying to incite people into taking part in violence at a time when the international community was jointly battling the pandemic.
“Does Hong Kong have a future, if such malfeasances are let go?” it asked.
The office said that violence was the reason for a rising wave of business closures and unemployment in Hong Kong.
The office also criticized opposition lawmakers for promoting the so-called “yellow economy” that support pro-democracy protests to help gain seats in the September’s Legislative Council elections.
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