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1
Update on the Hong Kong Economy for Update on the Hong Kong Economy for The Task Force on Economic ChallengesThe Task Force on Economic Challenges
Government EconomistGovernment Economist
22 January 200922 January 2009
2
Global developments since last meeting (1)
• Concern over financial market meltdown receded, but global downturn deepening, taking its toll on world trade
• Pressure now spread to wide range of businesses, due to downward spiral from credit crunch; asset market plunge and deteriorating sentiment from job losses
• Asia also hard hit; exports of many Asian economies showed double-digit declines in Nov
• Inflation receding fast, amid weak demand conditions
3
Global developments since last meeting (2)
• Central banks pursuing aggressive monetary easing; benchmark interest rates approaching zero in some advanced economies
• Governments continue to roll out more stimulus packages; US’s huge package still in the pipeline
• Financial institutions in the US and UK continued to report huge losses over the past weeks; UK government just announced its second rescue plan
4
Local developments since last meeting
• Exports suffered across-the-board decline in Nov
• Retail sales and restaurant business show signs of relative improvement during latter half of Dec
• Housing market stabilised somewhat after drastic decline
• Interbank rates down to level before global crisis; credit conditions for some sectors eased somewhat, but credit situations in hard-hit sectors like I/E trade remain severe
• Unemployment rate risen further; job vacancies sharply lower
• 14 measures from Central Government on 19 December 2008 to support Hong Kong economy
5
Global economic situation worsened more than expected…
6
...leading to a successive mark-down in forecasts
Jan 2008 Aug 2008 Jan 2009World 2.8 2.6 -0.2
United States 2.7 1.4 -1.8
Euro area 2.0 1.1 -1.4 Germany 1.9 1.1 -2.0
United Kingdom 2.0 0.9 -2.2
Japan 2.0 1.2 -1.7
China 9.8 9.2 7.4India 8.4 7.7 5.6Hong Kong 5.3 4.7 -1.3Singapore 6.0 5.0 -2.4South Korea 5.0 4.4 0.6Taiwan 4.7 4.7 -1.1Malaysia 5.9 5.2 1.4Thailand 4.9 4.9 1.1
Average of private sector forecasts for 2009
7
US mired in recession…
8
Job losses posing a severe drag on US consumption
-12
-8
-4
0
4
8
12
16
1/93 1/94 1/95 1/96 1/97 1/98 1/99 1/00 1/01 1/02 1/03 1/04 1/05 1/06 1/07 1/08-3
-2
-1
0
1
2
3
4
Retail Sales(LHS)
Employment(RHS)
Year-on-year growth rate (%) Year-on-year growth rate (%)
Dec08-2.0-9.8
9
Plunge in business sentiment; investment stalls
-40
-30
-20
-10
0
10
20
30
40
3/99 3/00 3/01 3/02 3/03 3/04 3/05 3/06 3/07 3/0820
30
40
50
60
70
80
Gross PrivateInvestment (LHS)
Year-on-year growth rate (%)
Business Confidence(RHS)
Index
10
US imports falling even faster, which impact severely on Asia’s exports
-20
-15
-10
-5
0
5
10
15
20
25
30
1/96 1/97 1/98 1/99 1/00 1/01 1/02 1/03 1/04 1/05 1/06 1/07 1/08
US's importdemand
Year-on-year growth rate in real terms (%)
US's importsfrom Asia
Nov08-8.8
-10.9
11
US inventories have depleted significantly; but it will take some time for inventory rebuilding
to resume
-9
-6
-3
0
3
6
9
12
15
18
Q170
Q172
Q174
Q176
Q178
Q180
Q182
Q184
Q186
Q188
Q190
Q192
Q194
Q196
Q198
Q100
Q102
Q104
Q106
Q108
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
Change in Inventoryas % of GDP
(RHS)
Real GDPq-t-q annualised
% growth(LHS)
2008Q3:CIV as % of GDP: -0.25%
Real GDP q-t-q growth: -0.5%
(%)
5 Qtrs
2 Qtrs
3 Qtrs
(%)
4 Qtrs
3 Qtrs
12
Situation in EU and Japan likewise worrying …
13
EU’s business sentiment lowest in 15 years; imports cut back sharply amid recession mode
-35
-30
-25
-20
-15
-10
-5
0
5
10
15
20
25
30
35
01 02 03 04 05 06 07 08-6
-4
-2
0
2
4
6
EU's import demandin real terms (LHS)
EU's GDPannualised q-t-q rate of
change in real terms(RHS)
Year-on-yeargrowth rate (%)
Quarter-to-quarter growth rate (%)
Oct08-8.0%
Q308-0.7%
-40
-30
-20
-10
0
10
20
1/97 1/98 1/99 1/00 1/01 1/02 1/03 1/04 1/05 1/06 1/07 1/08
Dec08-39.9%
EU'sSentiment
Index
Year-on-year growth rate (%)
14
Similar situation in Japan
-50
-40
-30
-20
-10
0
10
20
30
40
50
95 96 97 98 99 00 01 02 03 04 05 06 07 08-5
-4
-3
-2
-1
0
1
2
3
4
5
Q308 Real GDPGrowth: -0.5%
Index
Q408 Tankan:-16
Japan Import Demand
-12
-10
-8
-6
-4
-2
0
2
4
6
8
10
12
14
16
18
20
1/01 1/02 1/03 1/04 1/05 1/06 1/07 1/08
Year-on-year growth rate (%)
Nov08:0.5%
Japan GDP vs Tankan Survey
Japan GDP RealGrowth (RHS)
Japan TANKANLarge enterpriese (LHS)
%
15
Exports in Asia all plunging in NovemberGDP growth slowing
-2
0
2
4
6
8
10
12
14
Q104
Q204
Q304
Q404
Q105
Q205
Q305
Q405
Q106
Q206
Q306
Q406
Q107
Q207
Q307
Q407
Q108
Q208
Q308
China Japan Hong Kong Singapore
Korea Taiwan Indonesia Malaysia
Philippines Thailand
Year-on-year growth rate (%)
Exports all down
-50
-40
-30
-20
-10
0
10
20
30
40
50
60
01/04 01/05 01/06 01/07 01/08
China Japan Hong Kong Singapore
Korea Taiwan Indonesia Malaysia
Philippines Thailand
Year-on-year growth rate (%)
16
China’s external trade affected in a significant way...
17
Export orders are markedly down CFLP China Manufacturing PMI
( New export orders shifted forward by 1 months)
25
30
35
40
45
50
55
60
65
70
75
01/05 07/05 01/06 07/06 01/07 07/07 01/08 07/08 01/09-50
-40
-30
-20
-10
0
10
20
30
40
50
China Manufacturing PMI - New export orders (LHS)
China's exports (RHS)
PMI (Index) Year-on-year rate of change (%)
18
Industrial value-added growth at record low*
• Excluding January and February, in which the year-on-year comparisons are distorted by the different timing of
the Lunar New Year each year.
0
2
4
6
8
10
12
14
16
18
20
Q197
Q397
Q198
Q398
Q199
Q399
Q100
Q300
Q101
Q301
Q102
Q302
Q103
Q303
Q104
Q304
Q105
Q305
Q106
Q306
Q107
Q307
Q108
Q308
0
2
4
6
8
10
12
14
Value added of industry (LHS)
Real GDP (RHS)
Year-on-year rate of change (%)
11/08
Year-on-year rate of change (%)
19
Guangdong’s processing exports and imports both plunging
China's Exports
-20
-10
0
10
20
30
40
50
01/06 07/06 01/07 07/07 01/08 07/08
Mainland's exports
Guangdong's exports
Guangdong's processingtrade exports
China's Imports
-40
-30
-20
-10
0
10
20
30
40
50
01/06 07/06 01/07 07/07 01/08 07/08
Mainland's imports
Guangdong's imports
Guangdong's processingtrade imports
12/2008Guangdong's processing
trade import : -29.7%
Year on Year growth (%)
12/2008Guangdong's processing
trade export : -15.5%
Year on Year growth (%)
20
Mainland’s retail sales still firm
5
7
9
11
13
15
17
19
01/05 04/05 07/05 10/05 01/06 04/06 07/06 10/06 01/07 04/07 07/07 10/07 01/08 04/08 07/08 10/08
Real growth (%)
90
91
92
93
94
95
96
97
98
99
100Index (Dec 97 =100)
Retail Sales excluding fuel (above designated size enterprise, LHS)
Retail sales: Total (LHS)
Consumer confidence (RHS)
21
Impact of global financial turmoil on Hong Kong
22
Financial services
23
Financial sector activities sharply down in 2008 Q3
Non-bank financingcompanies
(LHS)
Banking(RHS)
Insurance(RHS)
-60
-40
-20
0
20
40
60
80
100
120
Q198
Q398
Q199
Q399
Q100
Q300
Q101
Q301
Q102
Q302
Q103
Q303
Q104
Q304
Q105
Q305
Q106
Q306
Q107
Q307
Q108
Q308
-30
-20
-10
0
10
20
30
40
50
60
Business receipts(year-on-year growth rate (%))
Business receipts(year-on-year growth rate (%))
24
…as stock market turnover dwindled
5000
10000
15000
20000
25000
30000
35000
0107
0307
0507
0707
0907
1107
0108
0308
0508
0708
0908
1108
0109
6000
7000
8000
9000
10000
11000
12000
13000
14000
15000
Hang Seng Index(LHS)
0
50
100
150
200
250
0107
0307
0507
0707
0907
1107
0108
0308
0508
0708
0908
1108
0109
Dow Jone'sIndustrial Average Index
(RHS)
Index Index
21.1.09HSI 12584
20.1.09DJ 7949
21/147.7
Daily total turnover (HK$ Bn)
25
…and loan growth down further
Loans for use in HK(excluding trade
finance)
-30
-20
-10
0
10
20
30
40
1/97 1/98 1/99 1/00 1/01 1/02 1/03 1/04 1/05 1/06 1/07 1/08
Year-on-year growth rate (%)
Trade finance1998AFC
2001global
downturn
Currentglobalcrisis
Nov0811.5%
1.7%
26
Financial services sector: unemployment/vacancy*
* Private sector vacancies posted by the Labour Department. Latest unemployment rates are provisional.
0
1
2
3
4
5
6
7
Q197
Q198
Q199
Q100
Q101
Q102
Q103
Q104
Q105
Q106
Q107
Q108
TotalHigher-skilledLower-skilled
Unemployment rate (%)
-100
-50
0
50
100
150
200
250
1/02 1/03 1/04 1/05 1/06 1/07 1/08
Year-on-year rate of change in vacancies (%)
1998AFC
2001global
downturn
2003SARS
Currentglobalcrisis
118%
1.6%
1.4%
0.8%
27
Financial services sector: SME weekly survey on business receipt
% decline as compared to normal situation for the week ending:-
SMEs by sectors 28 Nov 5 Dec 12 Dec 19 Dec26 Dec
and 2 Jan 9 Jan
Wholesale trade -24.7 -16.0 -16.4 -16.4 -10.8 -7.6
Retail trade -24.8 -23.8 -24.2 -22.9 -23.2 -22.4
Import/export trades -17.8 -19.4 -18.3 -16.9 -18.9 -19.3
Restaurants -13.9 -14.7 -13.9 -13.1 -12.1 -13.1
Logistics -29.7 -39.0 -34.7 -36.9 -33.5 -38.5
Travel agents -15.2 -11.4 -12.2 -12.1 -12.6 -11.9
Financing institutions
-23.3 -24.1 -24.5 -23.2 -20.7 -18.9
Insurance agents and brokers
-9.2 -9.6 -9.4 -9.7 -9.9 -9.5
Real estate and construction
-32.5 -28.9 -31.7 -31.4 -30.6 -30.4
Business services -8.9 -7.6 -8.0 -11.4 -10.9 -10.3
All the above sectors -18.5 -19.3 -18.4 -17.3 -18.5 -18.5
28
Trading and logistics
29
-15
-10
-5
0
5
10
15
20
25
Q197
Q397
Q198
Q398
Q199
Q399
Q100
Q300
Q101
Q301
Q102
Q302
Q103
Q303
Q104
Q304
Q105
Q305
Q106
Q306
Q107
Q307
Q108
Q308
0
1
2
3
4
5
6
7
8
Hong Kong'stotal exports
(LHS)
World GDP*(RHS)
Year-on-year growthrate in real terms (%)
Year-on-year growthrate in real terms (%)
* The world GDP being plotted here is weighted by Hong Kong's total exports of goods.
Nov08-7.1%
Exports down 7% in November...
1998 AFC
2001 global
downturn
2003 SARS
Current global crisis
30
...drastic decline in cargo flows impacting severely on logistic sector
-80
-60
-40
-20
0
20
40
60
80
1/97 1/98 1/99 1/00 1/01 1/02 1/03 1/04 1/05 1/06 1/07 1/08-30
-25
-20
-15
-10
-5
0
5
10
15
20
25
30
Year-on-year growthrate in tonne (%)
Year-on-year growthrate in TEU (%)
Air cargo(LHS)
Container throughput(RHS)
Dec08-28.2%
-24.1%
31
Trading and logistics: unemployment/vacancy*
* Private sector vacancies posted by the Labour Department. Latest unemployment rates are provisional.
0
1
2
3
4
5
6
7
8
9
Q197
Q198
Q199
Q100
Q101
Q102
Q103
Q104
Q105
Q106
Q107
Q108
TotalHigher-skilledLower-skilled
Unemployment rate (%)
-60
-40
-20
0
20
40
60
80
100
1/02 1/03 1/04 1/05 1/06 1/07 1/08
Year-on-year rate of change in vacancies (%)
11/08
1998AFC
2001global
downturn
2003SARS
Currentglobalcrisis
-23%
4.9%
3.6%
2.1%
32
Trading and logistics: SME weekly survey on business receipt
% decline as compared to normal situation for the week ending:-
SMEs by sectors 28 Nov 5 Dec 12 Dec 19 Dec26 Dec and
2 Jan 9 Jan
Wholesale trade -24.7 -16.0 -16.4 -16.4 -10.8 -7.6
Retail trade -24.8 -23.8 -24.2 -22.9 -23.2 -22.4
Import/export trades -17.8 -19.4 -18.3 -16.9 -18.9 -19.3
Restaurants -13.9 -14.7 -13.9 -13.1 -12.1 -13.1
Logistics -29.7 -39.0 -34.7 -36.9 -33.5 -38.5
Travel agents -15.2 -11.4 -12.2 -12.1 -12.6 -11.9
Financing institutions
-23.3 -24.1 -24.5 -23.2 -20.7 -18.9
Insurance agents and brokers
-9.2 -9.6 -9.4 -9.7 -9.9 -9.5
Real estate and construction
-32.5 -28.9 -31.7 -31.4 -30.6 -30.4
Business services -8.9 -7.6 -8.0 -11.4 -10.9 -10.3
All the above sectors -18.5 -19.3 -18.4 -17.3 -18.5 -18.5
33
Tourism and consumption-related sector
34
Retail sales still down in Nov; tourist arrivals showed some relative
improvement in Dec
* The December 2008 figure is a crude estimate.
-5
0
5
10
15
20
25
1/05 7/05 1/06 7/06 1/07 7/07 1/08 7/08
Year-on-year growth rate (%)
-10
-5
0
5
10
15
20
25
30
1/05 7/05 1/06 7/06 1/07 7/07 1/08 7/08
Retail sales
Year-on-year growth rate in volume (%)
Inbound tourists*
Nov08 -2.8%
35
Tourism and consumption-related sector: unemployment/vacancy*
* Private sector vacancies posted by the Labour Department. Latest unemployment rates are provisional.
0
2
4
6
8
10
12
14
16
Q197
Q198
Q199
Q100
Q101
Q102
Q103
Q104
Q105
Q106
Q107
Q108
TotalHigher-skilledLower-skilled
Unemployment rate (%)
-80
-40
0
40
80
120
160
200
1/02 1/03 1/04 1/05 1/06 1/07 1/08
Year-on-year rate of change in vacancies (%)
11/08
1998AFC
2001global
downturn
2003SARS
Currentglobalcrisis
11%
6.3%
5.8%
2.7%
36
Tourism and consumption-related sector: SME weekly survey on business receipt
% decline as compared to normal situation for the week ending:-
SMEs by sectors 28 Nov 5 Dec 12 Dec 19 Dec26 Dec and
2 Jan 9 Jan
Wholesale trade -24.7 -16.0 -16.4 -16.4 -10.8 -7.6
Retail trade -24.8 -23.8 -24.2 -22.9 -23.2 -22.4
Import/export trades -17.8 -19.4 -18.3 -16.9 -18.9 -19.3
Restaurants -13.9 -14.7 -13.9 -13.1 -12.1 -13.1
Logistics -29.7 -39.0 -34.7 -36.9 -33.5 -38.5
Travel agents -15.2 -11.4 -12.2 -12.1 -12.6 -11.9
Financing institutions -23.3 -24.1 -24.5 -23.2 -20.7 -18.9
Insurance agents and brokers
-9.2 -9.6 -9.4 -9.7 -9.9 -9.5
Real estate and construction
-32.5 -28.9 -31.7 -31.4 -30.6 -30.4
Business services -8.9 -7.6 -8.0 -11.4 -10.9 -10.3
All the above sectors -18.5 -19.3 -18.4 -17.3 -18.5 -18.5
37
Real estate and construction sector
38
Property market took a breather in December after drastic decline for 2 months
40
60
80
100
120
140
160
180
200
1/03 1/04 1/05 1/06 1/07 1/08
Residential Price Index (Overall)
Residential Price Index (Large)
Residential Price Index (Small)
Indexx
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
1/03 1/04 1/05 1/06 1/07 1/08
Residential propertytransactions
Number
Dec
135.6
102.8101.6
4706
Dec
39
-40
-30
-20
-10
0
10
20
30
40
50
Q197
Q198
Q199
Q100
Q101
Q102
Q103
Q104
Q105
Q106
Q107
Q108
Q109
Building & construction expenditure (Private)
Building consents (8-quarter moving average)(2-quarters lag)
Year-on-year growth rate in real terms (%)
-10.0%
Q308-5.0%
New private construction projects have stalled…
…but Government’s increased construction to provide some offset
Building and construction expenditure
2008 Q1 – Q3
Year-on-year % change% share of
total
Private -0.1% 78%
Public 1.9% 22%
Total 0.4%
40
Real estate and construction sector: unemployment/vacancy*
* Private sector vacancies posted by the Labour Department. Latest unemployment rates are provisional.
0
5
10
15
20
25
Q197
Q198
Q199
Q100
Q101
Q102
Q103
Q104
Q105
Q106
Q107
Q108
TotalHigher-skilledLower-skilled
Unemployment rate (%)
-60
-40
-20
0
20
40
60
80
100
120
1/02 1/03 1/04 1/05 1/06 1/07 1/08
Year-on-year rate of change in vacancies (%)
11/08
1998AFC
2001global
downturn
2003SARS
Currentglobalcrisis
-24%
6.1%
5.1%
2.4%
41
Real estate and construction sector: SME weekly survey on business receipt
% decline as compared to normal situation for the week ending:-
SMEs by sectors 28 Nov 5 Dec 12 Dec 19 Dec26 Dec and
2 Jan 9 Jan
Wholesale trade -24.7 -16.0 -16.4 -16.4 -10.8 -7.6
Retail trade -24.8 -23.8 -24.2 -22.9 -23.2 -22.4
Import/export trades -17.8 -19.4 -18.3 -16.9 -18.9 -19.3
Restaurants -13.9 -14.7 -13.9 -13.1 -12.1 -13.1
Logistics -29.7 -39.0 -34.7 -36.9 -33.5 -38.5
Travel agents -15.2 -11.4 -12.2 -12.1 -12.6 -11.9
Financing institutions -23.3 -24.1 -24.5 -23.2 -20.7 -18.9
Insurance agents and brokers
-9.2 -9.6 -9.4 -9.7 -9.9 -9.5
Real estate and construction
-32.5 -28.9 -31.7 -31.4 -30.6 -30.4
Business services -8.9 -7.6 -8.0 -11.4 -10.9 -10.3
All the above sectors -18.5 -19.3 -18.4 -17.3 -18.5 -18.5
42
Total job losses by sector since Jun-Aug 2008
Difference in employment at Oct-Dec 2008 as compared to Jun-Aug 2008
-12 100
Trading (1) -7 400
Logistics (2) -4 700
-11 400
Financing -10 600
Insurance - 800
8 100
Retail trade 6 400
Restaurants 1 900
Hotels - 100
9 600
Real estate 5 600
Construction 4 000
Notes: (1) The trading sector includes import/export trades and wholesale trade. (2) The logistics sector includes freight transport, storage, postal and courier services. (3) The figures being listed here are provisional.
Source: General Household Survey, Census and Statistics Department.
Financial services
Trading and logistics
Tourism and consumption-relatedservices
Real estate and construction
43
Feedback from SMEs
44
Impact on business receipts% decline as compared to normal situation for the week ending:-
SMEs by sectors 28 Nov 5 Dec 12 Dec 19 Dec26 Dec
and 2 Jan 9 Jan
Wholesale trade -24.7 -16.0 -16.4 -16.4 -10.8 -7.6
Retail trade -24.8 -23.8 -24.2 -22.9 -23.2 -22.4
Import/export trades -17.8 -19.4 -18.3 -16.9 -18.9 -19.3
Restaurants -13.9 -14.7 -13.9 -13.1 -12.1 -13.1
Logistics -29.7 -39.0 -34.7 -36.9 -33.5 -38.5
Travel agents -15.2 -11.4 -12.2 -12.1 -12.6 -11.9
Financing institutions
-23.3 -24.1 -24.5 -23.2 -20.7 -18.9
Insurance agents and brokers
-9.2 -9.6 -9.4 -9.7 -9.9 -9.5
Real estate and construction
-32.5 -28.9 -31.7 -31.4 -30.6 -30.4
Business services -8.9 -7.6 -8.0 -11.4 -10.9 -10.3
All the above sectors -18.5 -19.3 -18.4 -17.3 -18.5 -18.5
45
Impact on employment% change as compared to normal situation for the week ending:-
SMEs by sectors 28 Nov 5 Dec 12 Dec 19 Dec26 Dec and
2 Jan 9 Jan
Wholesale trade 0 0 0 0 0 0
Retail trade -0.6 -0.4 -0.8 -0.4 -0.6 -0.9
Import/export trades -2.3 -1.6 -0.8 -0.8 -0.9 -1.1
Restaurants -2.8 -3.1 -3.3 -2.8 -3.4 -2.9
Logistics -5.8 -6.0 -6.7 -6.7 -4.1 -4.1
Travel agents +0.5 +0.6 0 0 -0.4 0
Financing institutions -0.3 -0.3 -1.0 -1.3 -0.7 -0.9
Insurance agents and brokers
0 0 0 0 0 0
Real estate and construction
-7.3 -6.2 -7.6 -8 -8.1 -8.4
Business services -4.5 -2.7 -3.1 -3.2 -3.1 -3.0
All the above sectors -2.4 -1.9 -1.8 -1.7 -1.7 -1.8
46
Impact on access to creditTighter than normal for the week ending:-
SMEs by sectors 28 Nov 5 Dec 12 Dec 19 Dec26 Dec and
2 Jan 9 Jan
(% of SMEs)
Wholesale trade 12.0 9.1 9.1 9.5 10.0 5.0
Retail trade 10.0 8.5 10.1 8.5 8.8 8.0
Import/export trades 17.1 17.1 15.8 17.0 17.0 15.6
Restaurants 19.0 15.3 13.6 14.3 10.7 10.5
Logistics 0 15.0 5.6 11.1 11.8 11.8
Travel agents 3.3 3.6 3.6 3.7 3.8 3.7
Financing institutions 12.5 12.5 12.5 13.2 10.8 10.8
Insurance agents and brokers
15.0 11.1 10.5 5.0 10.0 10.5
Real estate and construction
11.4 11.4 8.6 9.1 5.9 2.9
Business services 5.7 5.7 5.7 6.1 6.1 0
All the above sectors 12.5 12.5 11.6 12.1 11.9 10
47
2009 outlook
48
Further mark-down by private sector analysts on Hong Kong’s GDP in 2009
S&P: 0.7-1.2% Credit Suisse: -2.2%
Bank of China: 0.5% Hang Seng Bank: -3%
Citigroup: 0.3% Goldman: -3%
Standard Chartered:
-0.9% Morgan Stanley: -3.8%
Fitch: -1.2% Deutsche Bank -4%
JP Morgan: -1.3%
HSBC: -2%
49
Our latest assessment
• With global recession now underway, worst is yet to come; timing of recovery
depends on effectiveness of stimulus packages by major economies
• HK economy likely to experience negative growth for several quarters, leading
to further job losses and rising unemployment
• Government’s efforts to ease credit access and create employment to render
some help during this difficult period; support from the Central Government a
confidence booster
• Inflation will come down visibly, which should help enhance competitiveness
• Confidence is key; HK economy set to recover once the external environment
improves
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End