Hong Kong falls into first recession in 10 years: government estimate


The economy shrank by 2.9% year-on-year in the third quarter after a positive growth of 0.5% YoY in 2Q19.

Hong Kong's economy contracted by 3.2% quarter-on-quarter in the third quarter of this year and is now in a technical recession.

Hong Kong's economy only expanded modestly by 0.5 percent in the first half of 2019, marking the weakest economic performance since the recession in 2009, Lam noted.

Despite the hard external and domestic environment, Hong Kong retains its core strengths as an global financial center with an unrivalled geographical location, the rule of law, an independent judiciary, the free flow of information and a wide pool of professional talents, she said.

The government also revised down second-quarter GDP data to 0.4 per cent year-on-year, from 0.6 per cent, and a contraction of 0.5 per cent quarter on quarter, versus 0.3 per cent previously.

"As the weakening economic conditions dampened consumer sentiment and large-scale demonstrations cause severe disruptions to the retail, catering and other consumer-related sectors, private consumption expenditure recorded its first year-on-year decline in more than 10 years".

Capital Economics said in a research note that while GDP would probably continue to contract in the fourth quarter, the pace of contraction should ease somewhat barring a further escalation in the demonstrations.

There has been talk that some crew members were angry after the park's managers were suspected of tweaking the script of the show by taking out what they deem politically sensitive terms like "Hong Kong people, add oil", a popular chant of anti-government protesters.

China denies meddling and has accused foreign governments, including the United States and Britain, of stirring up trouble.

The march hasn't been authorized by the city's police.

This month Hong Kong leader Carrie Lam banned protesters from wearing face masks under a British colonial-era emergency law, but the measure has been largely ignored.

Economic growth in the former British territory has "moderated progressively since past year amid a slowing global economy and U.S. -Mainland trade tensions", a government press release said, adding that recent "social incidents" have caused an "abrupt deterioration". Retail sales fell by a quarter in August, the steepest annual drop on record.

Business has plunged in Hong Kong's shopping districts after more than four months of protests.

"For months she has done nothing for Hong Kong but defend the authorities", she told AFP.

The IPO market is also proving resilient: In September Anheuser-Busch InBev listed its Asia business on the Hong Kong Stock Exchange raising $5 billion in the second biggest IPO of the year after Uber. Mainland visitors still account for nearly 80 per cent of total arrivals in Hong Kong. "This is it. It's not coming back", said Andy Xie, a Shanghai-based independent economist formerly at Morgan Stanley.