Hong Kong government expects uncertainties to overwhelm Hong Kong's economy, lead private sector, up to 1.7% next year

Financial news

Written by: Yue Yueting

2019-11-27 13:32

The Hong Kong Government issues the "Hong Kong Economic Situation and Short-term Outlook" document to the Legislative Council Panel on Financial Affairs. In the face of a very uncertain external environment, it is expected that the economic outlook of Hong Kong next year will be full of uncertainties, including: trade barriers, geopolitics, and ongoing Local social events and violence may further disrupt global supply chains and also hurt global economic confidence, investment and economic growth.

The document states that if the violent demonstrations continue, the business environment of the consumer and tourism-related industries will be worsened, further weakening foreign investors and Hong Kong citizens ’economic confidence in Hong Kong, and increasing downward pressure on private consumption and investment next year. If the situation continues, other industries will also be dragged down, putting greater pressure on the local labor market.

The document quotes the analysis of the International Monetary Fund and the private sector for reference. The latest forecast of Hong Kong's economic growth in 2020 ranges from a contraction of 0.7% to an increase of 1.7%; the forecast of consumer price inflation ranges from 1.8% to 2.6%.

However, if the Mainland and the United States can reach the first-phase trade agreement in the short term and cancel some of the tariffs, the global economic climate is believed to improve, and the government will pay close attention to local and peripheral developments.

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