Hong Kong Chief Executive Carrie Lam Cheng Yuet-ngor warned that Asia’s financial center is bracing for an “economic tsunami” never before seen — a situation worse than during the 2003 SARS epidemic and the 2008 global financial crisis.
Lam called for concerted efforts to pull Hong Kong back from the abyss, as the escalating Sino-US trade dispute and more than two months of protests initially against now-scrapped amendments to the special administrative region’s extradition laws could have a longer-than-expected chilling effect on the local economy.
Flanked by nine officials and business heavyweights at a news conference after meeting with 33 representatives from the city’s hard-pressed sectors on Friday, Lam said the government’s overarching goal at the moment is to put an end to violent clashes, restore law and order, and fearlessly safeguard the city’s rule of law.
“The chaotic situation in Hong Kong cannot continue. This is the consensus I have reached with 33 representatives from the business community at the meeting,” Lam said.
Due to the worrying situation, Lam announced that the Executive Council — the advisory body to the chief executive — will resume its weekly meetings on Tuesday instead of on Aug 27, as originally planned.
A package of stimulus measures will be introduced to support employment and lend a helping hand to the city’s suffering companies in the upcoming Policy Address in October, Lam said.
Financial Secretary Paul Chan Mo-po added: “The pair of top priorities on the government agenda is to support employment and lend a helping hand to companies.”
The SAR government looks to ease the burden on companies’ operational expenditures, help them solve the liquidity squeeze and offer strong support to seek for business partners, Chan said.
More than 340,000 small- and medium-sized enterprises in the city, which account for over 98 percent of business units and employ about 45 percent of the private sector’s workforce, have borne the brunt of the violent clashes.
Some SMEs have seen their businesses shrink by 30 percent and are now tottering on the brink of bankruptcy, said Joe Chau Kwok-ming, president of the Hong Kong General Chamber of Small and Medium Business, at the news conference.
Local retailers have not fared much better. Bankee Kwan Pak-hoo, board member of the Hong Kong Retail Management Association, said the city’s retail industry has recorded a high single-digit percentage drop in July and is estimated to post a high double-digit decline in August.
Over the past two months, many retailers have operated in the red. This could eventually lead to a wave of job losses, Kwan warned.
“Business sectors and people’s livelihoods are closely related and mutually dependent. One crumbles, others fall like dominoes.”
Reiterating her tough stance against violent clashes, Lam accused protesters of gambling with the livelihoods of 7 million people and the city’s prosperity and safety.
“The worrying message from business sectors should sound the alarm and serve as a wake-up call for us. In times of troubles, we need to pull together to weather the storm.”
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