Transcript Update on the Hong Kong Economy for The Task Force on Economic Challenges Government Economist 22 January 2009

Update on the Hong Kong Economy for
The Task Force on Economic Challenges
Government Economist
22 January 2009
1
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
2
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
3
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
4
Global economic situation worsened
more than expected…
5
...leading to a successive mark-down in forecasts
Average of private sector forecasts for 2009
Jan 2008
Aug 2008
Jan 2009
2.8
2.6
-0.2
United States
2.7
1.4
-1.8
Euro area
Germany
United Kingdom
2.0
1.9
2.0
1.1
1.1
0.9
-1.4
-2.0
-2.2
Japan
2.0
1.2
-1.7
China
India
Hong Kong
Singapore
South Korea
Taiwan
Malaysia
Thailand
9.8
8.4
5.3
6.0
5.0
4.7
5.9
4.9
9.2
7.7
4.7
5.0
4.4
4.7
5.2
4.9
7.4
5.6
-1.3
-2.4
0.6
-1.1
1.4
1.1
World
6
US mired in recession…
7
Job losses posing a severe drag on US
consumption
16
Year-on-year growth rate (%)
Year-on-year growth rate (%)
12
8
4
3
Retail Sales
(LHS)
2
4
1
0
0
-4
-8
-1
Employment
(RHS)
Dec08
-2.0
-9.8
-12
-2
-3
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
8
Plunge in business sentiment;
investment stalls
40
Index
Year-on-year growth rate (%)
Business Confidence
(RHS)
30
80
70
20
60
10
0
50
Gross Private
Investment (LHS)
-10
40
-20
30
-30
-40
20
3/99
3/00
3/01
3/02
3/03
3/04
3/05
3/06
3/07
3/08
9
US imports falling even faster, which
impact severely on Asia’s exports
30
Year-on-year growth rate in real terms (%)
25
US's import
demand
20
US's imports
from Asia
15
10
5
0
-5
Nov08
-8.8
-10.9
-10
-15
-20
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
10
US inventories have depleted significantly; but
it will take some time for inventory rebuilding
to resume
18
(%)
(%)
Real GDP
q-t-q annualised
% growth
(LHS)
15
12
2008Q3:
CIV as % of GDP: -0.25%
Real GDP q-t-q growth: -0.5%
4 Qtrs
2.0
1.5
2 Qtrs
9
1.0
3 Qtrs
6
3 Qtrs
0.5
3
0
0.0
5 Qtrs
-3
-6
Change in Inventory
as % of GDP
(RHS)
-9
-0.5
-1.0
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08
11
Situation in EU and Japan likewise
worrying …
12
EU’s business sentiment lowest in 15 years;
imports cut back sharply amid recession mode
20
Year-on-year growth rate (%)
35
Year-on-year
growth rate (%)
EU's GDP
annualised q-t-q rate of
change in real terms
(RHS)
30
25
10
Quarter-to-quarter
growth rate (%)
20
Q308
-0.7%
6
4
15
0
2
10
5
-10
0
0
EU's import demand
in real terms (LHS)
-5
-20
-10
EU's
Sentiment
Index
Oct08
-8.0%
-15
-2
-20
-30
Dec08
-39.9%
-4
-25
-30
-35
-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
-6
01
02
03
04
05
06
07
08
13
Similar situation in Japan
Japan Import Demand
Japan GDP vs Tankan Survey
50
40
Index
%
5
20
Year-on-year growth rate (%)
18
Japan GDP Real
Growth (RHS)
4
30
3
16
14
12
20
2
10
1
10
Nov08:
0.5%
8
6
0
Q308 Real GDP
Growth: -0.5%
-10
0
2
-1
Q408 Tankan:
-16
-20
4
-2
0
-2
-4
-30
-40
-3
Japan TANKAN
Large enterpriese (LHS)
-4
-6
-8
-10
-50
-5
95 96 97 98 99 00 01 02 03 04 05 06 07 08
-12
1/01
1/02
1/03
1/04
1/05
1/06
1/07
1/08
14
Exports in Asia all plunging in November
GDP growth slowing
14
Exports all down
Year-on-year growth rate (%)
60
Year-on-year growth rate (%)
50
12
40
10
30
8
20
6
10
0
4
-10
2
-20
0
-30
-40
-2
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
04 04 04 04 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08
-50
01/04
01/05
01/06
01/07
01/08
China
Japan
Hong Kong
Singapore
China
Japan
Hong Kong
Singapore
Korea
Taiwan
Indonesia
Malaysia
Korea
Taiwan
Indonesia
Malaysia
Philippines
Thailand
Philippines
Thailand
15
China’s external trade affected in a
significant way...
16
Export orders are markedly down
CFLP China Manufacturing PMI
( New export orders shifted forward by 1 months)
75
Year-on-year rate of change (%)
PMI (Index)
50
70
40
65
30
60
20
55
10
50
0
45
-10
40
-20
35
China Manufacturing PMI - New export orders (LHS)
-30
China's exports (RHS)
30
25
01/05
-40
07/05
01/06
07/06
01/07
07/07
01/08
07/08
-50
01/09
17
Industrial value-added growth at record low*
20
18
Year-on-year rate of change (%)
Year-on-year rate of change (%)
Value added of industry (LHS)
Real GDP (RHS)
14
12
16
10
14
12
8
10
6
8
6
4
4
2
2
0
0
Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 11/08
97 97 98 98 99 99 00 00 01 01 02 02 03 03 04 04 05 05 06 06 07 07 08 08
• Excluding January and February, in which the year-on-year comparisons are distorted by the different timing of
the Lunar New Year each year.
18
Guangdong’s processing exports and
imports both plunging
China's Exports
50
China's Imports
Year on Year growth (%)
50
Year on Year growth (%)
40
40
30
30
20
20
10
10
0
-10
Mainland's imports
0
Mainland's exports
-20
Guangdong's imports
-30
Guangdong's processing
12/2008
trade imports
Guangdong's processing
Guangdong's exports
-10
Guangdong's processing
trade exports
-20
01/06
07/06
01/07
12/2008
Guangdong's processing
trade export : -15.5%
07/07
01/08
07/08
trade import : -29.7%
-40
01/06
07/06
01/07
07/07
01/08
07/08
19
Mainland’s retail sales still firm
19
Real growth (%)
Index (Dec 97 =100)
100
Retail Sales excluding fuel (above designated size enterprise, LHS)
17
Retail sales: Total (LHS)
99
Consumer confidence (RHS)
98
15
13
97
96
95
11
9
94
93
92
7
91
5
90
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
20
Impact of global financial turmoil
on Hong Kong
21
Financial services
22
Financial sector activities sharply
down in 2008 Q3
120
Business receipts
(year-on-year growth rate (%))
Business receipts
(year-on-year growth rate (%))
Non-bank financing
companies
(LHS)
100
80
60
60
50
40
30
Insurance
(RHS)
40
20
20
10
0
0
-20
Banking
(RHS)
-10
-40
-20
-60
-30
Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3
98 98 99 99 00 00 01 01 02 02 03 03 04 04 05 05 06 06 07 07 08 08
23
…as stock market turnover dwindled
35000
30000
Index
Index
Dow Jone's
Industrial Average Index
(RHS)
15000 250 Daily total turnover (HK$ Bn)
14000
13000 200
25000
12000
150
11000
20000
Hang Seng Index
(LHS)
10000
100
15000
9000
8000
10000
21.1.09
HSI 12584
20.1.09
DJ 7949
5000
7000
6000
01 03 05 07 09 11 01 03 05 07 09 11 01
07 07 07 07 07 07 08 08 08 08 08 08 09
21/1
47.7
50
0
01 03 05 07 09 11 01 03 05 07 09 11 01
07 07 07 07 07 07 08 08 08 08 08 08 09
24
…and loan growth down further
40
Year-on-year growth rate (%)
Trade finance
1998
AFC
30
2001
global
downturn
20
Nov08
11.5%
10
1.7%
0
Loans for use in HK
(excluding trade
finance)
-10
Current
global
crisis
-20
-30
1/97
1/98
1/99
1/00
1/01
1/02
1/03
1/04
1/05
1/06
1/07
1/08
25
Financial services sector:
unemployment/vacancy*
Unemployment rate (%)
Year-on-year rate of change in vacancies (%)
7
250
2003
SARS
6
Total
Higher-skilled
Lower-skilled
200
150
5
2001
global
downturn
4
Current
global
crisis
1998
AFC
3
118%
100
50
0
2
1.6%
1.4%
-50
1
0.8%
0
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
97 98 99 00 01 02 03 04 05 06 07 08
*
-100
1/02
1/03
1/04
1/05
1/06
1/07
1/08
Private sector vacancies posted by the Labour Department. Latest unemployment rates are provisional.
26
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 Dec
26 Dec
and 2 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
9 Jan
27
Trading and logistics
28
Exports down 7% in November...
25
Year-on-year growth
rate in real terms (%)
Year-on-year growth
rate in real terms (%)
2003
SARS
20
World GDP*
(RHS)
8
7
15
6
10
5
Hong Kong's
total exports
(LHS)
5
4
0
3
-5
2
-10
1998
AFC
2001
global
downturn
-15
Nov08
-7.1%
Current
global
crisis
1
0
Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3
97 97 98 98 99 99 00 00 01 01 02 02 03 03 04 04 05 05 06 06 07 07 08 08
* The world GDP being plotted here is weighted by Hong Kong's total exports of goods.
29
...drastic decline in cargo flows
impacting severely on logistic sector
80
Year-on-year growth
rate in tonne (%)
60
Year-on-year growth
rate in TEU (%)
Air cargo
(LHS)
Container throughput
(RHS)
25
20
40
15
10
20
5
0
0
-5
-20
Dec08
-28.2%
-40
-10
-15
-24.1%
-60
-80
1/97
30
-20
-25
-30
1/98
1/99
1/00
1/01
1/02
1/03
1/04
1/05
1/06
1/07
1/08
30
Trading and logistics:
unemployment/vacancy*
Year-on-year rate of change in vacancies (%)
Unemployment rate (%)
100
9
2003
SARS
8
Total
Higher-skilled
Lower-skilled
80
7
2001
global
downturn
6
1998
AFC
5
60
Current
global
crisis
40
4.9%
20
4
3.6%
0
3
-20
2
-23%
2.1%
-40
1
0
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
97 98 99 00 01 02 03 04 05 06 07 08
*
-60
1/02
1/03
1/04
1/05
1/06
1/07
Private sector vacancies posted by the Labour Department. Latest unemployment rates are provisional.
1/08
11/08
31
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 Dec
26 Dec
and 2 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
9 Jan
32
Tourism and consumptionrelated sector
33
Retail sales still down in Nov; tourist
arrivals showed some relative
improvement in Dec
30
Year-on-year growth rate (%)
Year-on-year growth rate in volume (%)
25
25
20
Retail sales
20
Inbound tourists*
15
15
10
10
5
5
0
0
-5
-10
1/05
Nov08
-2.8%
7/05
1/06
7/06
1/07
7/07
1/08
7/08
-5
1/05
7/05
1/06
7/06
1/07
7/07
1/08
7/08
* The December 2008 figure is a crude estimate.
34
Tourism and consumption-related sector:
unemployment/vacancy*
Year-on-year rate of change in vacancies (%)
Unemployment rate (%)
16
200
Total
Higher-skilled
Lower-skilled
14
160
2003
SARS
12
120
2001
global
downturn
10
8
Current
global
crisis
80
1998
AFC
40
6.3%
6
5.8%
11%
0
4
2.7%
-40
2
0
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
97 98 99 00 01 02 03 04 05 06 07 08
*
-80
1/02
1/03
1/04
1/05
1/06
1/07
Private sector vacancies posted by the Labour Department. Latest unemployment rates are provisional.
1/08 11/08
35
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 Dec
26 Dec and
2 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
9 Jan
36
Real estate and construction sector
37
Property market took a breather in December
after drastic decline for 2 months
200
Index
18000
x
180
Residential Price Index (Overall)
Residential Price Index (Large)
Residential Price Index (Small)
Number
Residential property
transactions
16000
14000
160
12000
140
135.6
10000
120
8000
102.8
101.6
100
6000
4706
80
4000
60
2000
40
1/03
1/04
1/05
1/06
1/07
1/08
Dec
0
1/03
1/04
1/05
1/06
1/07
1/08
Dec
38
New private construction projects
have stalled…
50
…but Government’s increased
construction to provide some offset
Year-on-year growth rate in real terms (%)
Building & construction expenditure (Private)
40
30
Building and construction expenditure
Building consents (8-quarter moving average)
(2-quarters lag)
2008 Q1 – Q3
Year-on-year % change
% share of
total
Private
-0.1%
78%
Public
1.9%
22%
Total
0.4%
20
10
0
-10
Q308
-5.0%
-10.0%
-20
-30
-40
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
97 98 99 00 01 02 03 04 05 06 07 08 09
39
Real estate and construction sector:
unemployment/vacancy*
Year-on-year rate of change in vacancies (%)
Unemployment rate (%)
25
120
Total
Higher-skilled
Lower-skilled
20
100
2003
SARS
80
60
15
2001
global
downturn
40
Current
global
crisis
20
1998
AFC
10
0
6.1%
5
-20
5.1%
-24%
2.4% -40
0
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
97 98 99 00 01 02 03 04 05 06 07 08
-60
1/02
1/03
1/04
1/05
1/06
1/07
1/08 11/08
40
*
Private sector vacancies posted by the Labour Department. Latest unemployment rates are provisional.
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 Dec
26 Dec and
2 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
9 Jan
41
Total job losses by sector
since Jun-Aug 2008
Difference in employment at Oct-Dec 2008 as compared to Jun-Aug 2008
Trading and logistics
Trading
(1)
Logistics
(2)
Financial services
-12 100
-7 400
-4 700
-11 400
Financing
-10 600
Insurance
- 800
Tourism and consumption-related
services
8 100
Retail trade
6 400
Restaurants
1 900
Hotels
- 100
Real estate and construction
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.
42
Feedback from SMEs
43
Impact on business receipts
% decline as compared to normal situation for the week ending:SMEs by sectors
28 Nov
5 Dec
12 Dec
19 Dec
26 Dec
and 2 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
9 Jan
44
Impact on employment
% change as compared to normal situation for the week ending:-
SMEs by sectors
28 Nov
5 Dec
12 Dec
19 Dec
26 Dec and
2 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
9 Jan
45
Impact on access to credit
Tighter than normal for the week ending:-
SMEs by sectors
28 Nov
5 Dec
12 Dec
19 Dec
26 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
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
Logistics
46
2009 outlook
47
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%
48
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
49
End
50