Hong Kong’s economic structure, which includes the US dollar peg, is part of its value proposition, but exposes it to global market forces. Unemployment and GDP figures show the city is managing the impact of external shocks, and its high labour productivity and famed resilience will hold it in good stead.
Through periods of crisis and uncertainty, the city has stayed relevant thanks to its resilience, adaptability and entrepreneurial spirit. Now, amid global geopolitical divergence, Hong Kong’s role as a link between East and West has never been more important.
In addition to providing support for local businesses beset by the pandemic, the 2022-23 budget promises to channel investment into strengthening ties between Hong Kong and the Greater Bay Area, and into making the city a hub for development of a regional green economy.
Without cooperation on access to vaccinations, economic policies and – most importantly for ensuring long-term growth – climate change, any recovery will be short lived.
On April 1, yuan-denominated bonds issued by China’s government and policy banks will be included in the Bloomberg Barclays Global Aggregate Index, tracked by US$2.5 trillion of assets under management, marking the start of a game-changing shift in global investment patterns
Chinese consumers are becoming more sophisticated, and now have a taste for avocado, coffee and electric cars. As China switches to growth based on consumption, there are great opportunities for businesses everywhere.
Despite the challenges, China's leaders are pushing into the most critical phase of their ambitious reform programme, cautiously unleashing the power of private investment and consumption to breathe new life into the slowing economy.