Hard-hit Hong Kong tops up stimulus with $511m cash fix
FAST FACT
Hong Kong’s government pledged HK$4 billion ($511 million) on Wednesday in new relief measures to help bolster an economy battered by months of protests that have eroded business confidence in the Asian financial hub.
The latest boost brings the government’s total pledged amount of relief to HK$25 billion. It remains to be seen whether that will be enough to help the economy, reeling from a drop-off in tourism and a record decline in retail sales.
The International Monetary Fund on Wednesday urged the Hong Kong government to deliver “significantly” more fiscal stimulus to address the downturn and longer-term structural issues such as insufficient housing and income inequality.
“During an economic downturn, supporting employment is the number one priority of the government,” Financial Secretary Paul Chan said as he announced the package.
Chan described the measures as mainly aimed at helping small and medium-sized businesses, in order to safeguard jobs.
He told reporters that the prolonged anti-Beijing demonstrations had hurt international investor confidence in the Chinese-ruled city.
Business activity in Hong Kong contracted at the fastest pace in 21 years in November, dragged down by the violent protests and softening global demand, an IHS Markit survey showed on Wednesday.
Asia’s largest distributor of luxury brands, the Blubell group, has appealed to Hong Kong landlords to scrap the base rent in shopping malls, saying a slump in tourist spending will push even more retailers out of business. Hong Kong recorded its largestever retail collapse in October, with sales dropping by 24.3 percent to
HK$30.1 billion, the government said on Monday.
Sparked by a controversial and since-withdrawn extradition bill, the protests have swelled into broader calls for greater democratic freedoms.
Protesters accuse China of interfering in freedoms promised to the former British colony when it was returned to Chinese rule in 1997.