Hong Kong headed for recession amid triple whammy of civil unrest, US-China trade war and falling global growth
Hong Kong’s economy faces an unprecedented triple threat as four months of increasingly violent protests, an escalating US-China trade war and a dip in global growth all take a downward-pulling toll.
With tourism and retail sectors tumbling, analysts believe the semi-autonomous Chinese city may have already tipped into its first recession in a decade. Hong Kong stocks, meanwhile, have reportedly suffered their worst quarter in four years as wary investors count their costs.
Financial analysts still doubt that the Asian financial hub’s fixed currency system pegged to the US dollar could falter, if hitherto modest capital outflows accelerate in coming weeks. But recent market activity suggests certain speculation is rising, despite stability in the overnight call rate, about a still unseen liquidity crunch.
Speaking at a news conference, Chief Executive Carrie Lam on October 8 lamented that, compared to last year, visitor numbers to Hong Kong plunged 53.6% in the first six days of October, when mainland tourists usually cross the border for shopping deals during China’s National Day holidays, otherwise known as “golden week” for merchants in the city.
Nile Bowie is a writer and journalist with the Asia Times covering current affairs in Singapore and Malaysia. He can be reached at nilebowie@gmail.com.
Hong Kong’s economy faces an unprecedented triple threat as four months of increasingly violent protests, an escalating US-China trade war and a dip in global growth all take a downward-pulling toll.
With tourism and retail sectors tumbling, analysts believe the semi-autonomous Chinese city may have already tipped into its first recession in a decade. Hong Kong stocks, meanwhile, have reportedly suffered their worst quarter in four years as wary investors count their costs.
Financial analysts still doubt that the Asian financial hub’s fixed currency system pegged to the US dollar could falter, if hitherto modest capital outflows accelerate in coming weeks. But recent market activity suggests certain speculation is rising, despite stability in the overnight call rate, about a still unseen liquidity crunch.
Speaking at a news conference, Chief Executive Carrie Lam on October 8 lamented that, compared to last year, visitor numbers to Hong Kong plunged 53.6% in the first six days of October, when mainland tourists usually cross the border for shopping deals during China’s National Day holidays, otherwise known as “golden week” for merchants in the city.
Read the full story at Asia Times.
