With Hong Kong’s economy showing mixed signs of picking up and the city betting on a sustained recovery amid hopes of long-awaited cuts in US interest rates, Financial Secretary Paul Chan Mo-po has called for concerted efforts to ride out external and internal headwinds in an ever-changing economic landscape and enable the city to thrive.
Writing in his weekly blog on Sunday, he struck an upbeat tone about the special administrative region’s economic prospects, citing potential interest-rate cuts on the horizon and strong trade momentum as supportive factors.
READ MORE: HKIC makes overseas debut in Thailand, eyeing Southeast Asia market
Although local retail sales have yet to show any sign of recovering, the finance chief said expected US rate cuts next month may weaken the Hong Kong dollar, making the SAR a more attractive location to spend. A series of high-profile events in the coming months are also likely to draw international business travelers to the city.
Latest local trade data have been encouraging, with exports having been on a tear for three consecutive quarters. Exports have jumped by 12.2 percent on-year in the first six months of 2024, racking up the best performance since 2022.
READ MORE: HK’s note-issuing banks vow faster loan verdicts to boost SME support
“If the exports momentum is maintained, coupled with falling external interest rates and improved investor sentiment, Hong Kong’s economic climate will remain stable for the rest of the year,” said Chan, adding that a cautious approach should be taken to assess the timing and extent of US rate cuts, and the far-reaching impact on capital markets and local investor sentiment.
Meanwhile, besides all the hypes and uncertainties externally, the finance chief said it’s vital to do more internal homework.
To be sure, the sheer power of technology has what it takes to be a new engine for the SAR’s future growth as it strives to sharpen its edge and ride out the challenges ahead.
Chan attended an innovation and entrepreneurship exhibition marking the 10th anniversary of Entrepreneur Day of The Chinese University of Hong Kong. He said he’s impressed by entrepreneurs’ enthusiasm to embrace technology to help the city forge its innovation-driven economy and improve people’s livelihood.
He is due to leave for Nanjing, Jiangsu province, this week to attend the SmartHK Jiangsu-Hong Kong High-Quality Development Cooperation Conference and explore a new pathway for regional collaboration with market leaders from the two regions’ business, financial, technology and cultural communities.
READ MORE: HK bourse profit drops in H1 as reform efforts pale amid market headwinds
As Hong Kong looks to the world beyond, Chan said he’ll also visit Australia, Spain and United Kingdom next month to promote the advantages of doing business in Hong Kong and seek closer integration and cooperation.
At the heart of Hong Kong’s unique and unbeatable advantages is “one country, two systems”, where the world-renowned financial center is blessed with a well-established legal regime, a dynamic business environment, and commercial rules aligned with the best international standards that place the city in a position to be a go-to destination for international cutting-edge technologies, top talents and diversified capital sources.
“Such unique strengths could hardly be given full play to without concerted and unremitting efforts from the government and local communities. It calls for better capitalizing on distinct advantages under ‘one country, two systems’ with a down-to-earth approach, a can-do spirit, as well as initiatives to cultivate new quality productive forces that move in line with local conditions,” Chan said.
Contact the writer at sophialuo@chinadailyhk.com
