released October 25, 2020
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Aerial photo taken on July 16, 2020 shows Wan Chai area of Hong Kong. [Photo/Xinhua]
HONG KONG -- The decline in Hong Kong's GDP in the third quarter should narrow significantly from the roughly 9-percent decline in the first two quarters of this year, Paul Chan, financial secretary of the Hong Kong Special Administrative Region (HKSAR) government, said Sunday.
Hong Kong's economy, which has contracted for four consecutive quarters, is not yet out of recession, but the contraction pressure is expected to be slightly relieved if the epidemic situation in Hong Kong continues to be contained, the financial chief wrote in a blog article.
The latest unemployment rate in Hong Kong is much grimmer than the macro-economic situation, Chan noted. The unemployment rate in Hong Kong increased by 0.3 percentage point from June-August 2020 to 6.4 percent in July-September, the highest in nearly 16 years.
The unemployment rate increased across a wide range of economic sectors, with significant hikes observed in the retail, accommodation and food services sector, while the underemployment rate also climbed to 3.8 percent in the third quarter, compared with just 1.2 percent of the same period last year.
But with the recovery momentum of the mainland economy and the gradual improvement of consumption in Hong Kong, Chan said Hong Kong's economy can still be greatly revived if the smooth flow of personnel and trade between Hong Kong and the mainland can be restored.
He stressed that compulsory testing for target groups, even large-scale compulsory testing, is an essential epidemic prevention tool. This will not only help control the epidemic, but also create conditions for resuming economic activities and easing the economic pressure on wage earners and enterprises.
He pointed out that Hong Kong, as a small and export-oriented economy, has always had relatively large economic activities, people flow, logistics and capital flow, which to a large extent depends on maintaining a high degree of business interaction and personnel circulation with the mainland and the rest of the world. Only by effectively controlling the epidemic can an environment conducive to economic recovery be created.
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