Hong Kong sees signs of life amid political stasis
Joseph Yu-shek Cheng
At the beginning of 2023 Hong Kong followed mainland China as it dramatically relaxed COVID-19 related travel restrictions. This considerably improved the territory’s economic mood. The tourism industry and retail trade are expected to be immediate beneficiaries of the change.
The Hang Seng Index — an indicator of Hong Kong’s market performance — stayed above the 21,500 mark in the week before the Chinese New Year, a substantial rebound from its low of below 15,000 in 2022. Even the real estate market promised a little optimism, anticipating buyers from mainland China. Government statistics show that Hong Kong’s real GDP contracted by 3.5 per cent in 2022, and in January 2023 a Bloomberg survey predicted a growth rate of 3.3 per cent in 2023.
There is still concern that COVID-19 will continue to spread in mainland China and Hong Kong because of the relaxation of social restrictions. The business community is weighed by the danger of a global economic recession in 2023. Talent outflow also remains a worry. The government admitted that 2214 civil servants resigned in the first half of the 2022–23 financial year, compared with 3732 resignations — 2.1 per cent of the civil service workforce — in the 2021–22 financial year.
Despite attractive remuneration in the police force, there were still 5706 vacant positions in 2021–22, a rise of 8.5 per cent from the previous year. Many schools complained about a shortage of teachers because of emigration. The Chief Executive offered initiatives to attract external talent in his 2022 policy address.
Read this piece by Joseph Yu-shek Cheng at the East Asia Forum.
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