A new spike in COVID-19 infections in Hong Kong has made the southern Chinese city’s economic recovery uncertain, Hong Kong Financial Secretary Paul Chan Mo-po said Sunday, calling for flexible responses and confidence among its residents.
“This summer, the residents reduced their trips outside the city, so local consumption in the retail and catering sectors should have improved. But new COVID-19 infections delayed consumption and thus the economy was unavoidably affected,” Chan said in a blog post on the HKSAR government website.
He said flexible responses and confidence are needed to achieve a gradual economic recovery.
“If citizens maintain confidence in our economic prospects and there is ample liquidity in the market, the propensity of consumers to go out and spend will definitely improve once the COVID-19 outbreak is brought under control,” he said, urging stores to move online to cushion the impact.
To spur consumption and raise confidence, the Hong Kong government launched a HK$10,000 ($1,290) cash handout program to help the city’s permanent residents. The program opened for registration on June 21, attracting over 6.2 million residents, most of the residents started to get their money last week, Chan said.
Chuang Shuk-kwan, head of the communicable disease branch of the Centre for Health Protection, warned on Saturday that the latest wave of infections was by far the most severe since the global pandemic started, as at least 61 people in Hong Kong were either confirmed or tested positive, the South China Morning Post reported.
Prior to the “third wave” of infections hitting the city, Chan said in June that Hong Kong’s economy was expected to bounce back from its lowest point in the second half of the yeqar, pinning hope on the enactment of the national security law to reduce unrest risks and maintain the city’s sound business and investment environment for the long-term prosperity.
In April, the financial secretary revised the full-year GDP forecast to a contraction of 4-7 percent. Hong Kong’s real Q1 GDP contracted 8.9 percent year-on-year, hitting a record low.
Chan said in the blog Sunday, “We will try our best to bring the epidemic under control, and stabilize confidence and the economy.”
The Hong Kong government has rolled out the largest scale of relief measures in history worth HK$290 billion to stabilize employment and reduce economic pressure on small and medium-sized enterprises and its residents.
A street in Central, Hong Kong Photo: VCG
