Hong Kong's economy is facing challenges due to the impact of the new crown epidemic and a series of external factors. Financial Secretary Chen Maobo published a blog today (15th) that the economy contracted by 4% in the first quarter of this year, interrupting the growth momentum of the previous four quarters. The growth forecast has also been lowered from the original 2 to 3.5% to 1 to 2%, which means that the recovery momentum of Hong Kong's GDP after a 6.3% growth in 2021 is weaker than expected, and the unemployment rate figures announced this week are expected to deteriorate further. .
However, Chen Maobo believes that there is no need to be too pessimistic. He also said that as long as the epidemic is steadily controlled and confidence is stabilized, the Hong Kong economy is expected to stabilize and grow slightly. The jobs, pressures and challenges will only make our economy more resilient and resilient.
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Decided to downgrade Hong Kong's full-year economic growth forecast after regular review
Chen Maobo mentioned in his blog that in addition to the impact of the epidemic, continued tensions in Sino-US relations, international geopolitical tensions, rising external inflation and the trend of interest rate hikes are all troubling the economic prospects of the world and Hong Kong. The economic data of Hong Kong is still weak. After the recent regular review, it was decided to lower the forecast of Hong Kong's annual economic growth from 2 to 3.5% to 1 to 2%.
Chen Maobo expects that as long as the epidemic continues to stabilize, the unemployment rate is expected to bottom out and gradually improve.
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It is expected that as long as the epidemic continues to stabilize, the unemployment rate is expected to bottom
He pointed out that the downward revision of economic growth means that Hong Kong's GDP will recover weaker than expected after growing by 6.3% in 2021, and the unemployment rate to be released this week is from February to April, which still reflects the situation at the peak of the epidemic. Therefore, it can be expected that the number will further deteriorate. However, in the past month or so, the epidemic has been gradually brought under control, and social distancing measures have been relaxed in stages. It is expected that as long as the epidemic continues to stabilize, the unemployment rate is expected to bottom out and gradually improve.
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Two rounds of consumer coupons are expected to boost the economy by 1.2 percentage points
For example, he pointed out that a new round of consumer coupons was issued in April, and the local retail and catering industry revenue figures in April should see a more obvious recovery. It is expected that the two phases of consumer coupons will boost the economy by 1.2 percentage points. With the support of measures to support enterprises, including a new round of employment protection plan, business confidence has gradually stabilized. In April, Hong Kong's PMI and SME business income trend index rebounded.
▼May 11th Matsumoto Kiyoshi "Hong Kong No. 1 Store" opened at apm▼
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Do a good job in risk management and control and cope with external changes
Given the downward revision of the annual economic forecast, the rising unemployment rate, and the gradual outflow of funds, he believes that there is no need to be too pessimistic. As long as the epidemic is stably controlled and confidence is maintained, the Hong Kong economy is expected to stabilize and grow slightly. Although it is difficult to control changes in the external environment, as long as risk management and our own work are done well, pressure and challenges will only make Hong Kong's economy more resilient and resilient.
▼Ocean Park Water Park will reopen on May 14▼
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The market gradually digests the risk of a faster rate hike
Taking the U.S. interest rate hike as an example, he said that it will inevitably affect global capital flows, asset prices and even economic activities, and also increase the loan interest burden on companies and citizens. The impact may be even greater. He stressed that the market is constantly adjusting its expectations and gradually digesting the risk of a faster rate hike. He believes that as long as risk management and contingency plans are done well, and vigilance and adaptability are maintained, the Hong Kong economy will be able to cope with complex and volatile conditions. It can also move forward stably in the environment.
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