[ad_1]
HONG KONG – For the first time since protests began in June 2019, Hong Kong has returned to a state resembling business as usual, with residents no longer facing transport shutdowns, quarantine, social distancing restrictions or a mask mandate.
Yet the legacy of the past few years means the city has a number of obstacles to overcome to return to its former condition, especially if it wants to compete with its rival Singapore.
At stake is bragging rights as Asia’s primary international finance hub.
Charting economic rebound
The city entered 2023 trying to dig itself out of a deep economic hole: Gross domestic product (GDP) contracted 3.5 per cent last year, the third time since 2019.
The end of Covid-19 restrictions and China’s reopening are expected to spur local growth and spending, with economists recently raising their median forecast for GDP expansion in 2023 to 3.4 per cent. Early signs of recovery include a 7 per cent jump year on year in retail sales for January.
But challenges remain with economists saying consumption, property investment and external trade will continue to face pressure from rising interest rates. A massive fiscal deficit also presents concerns, as does an exodus of highly skilled workers.
Stemming talent exodus
Since 2020, tens of thousands of people have left. Among them are scores of bankers, lawyers and other professionals who have traditionally helped to make this a freewheeling, international entrepot. While that outflow is slowing, according to the latest data, the city’s population continues to shrink at a time when the birth rate is among the world’s lowest.
Hong Kong leader John Lee has launched programmes to attract global talent. These include a two-year visa plan launched in October 2022 for high-income workers and top university graduates. So far, the result seems mixed. Most of the roughly 10,000 applications for that programme so far are from China, according to local media.
It is still not clear whether some of the top banking positions which shifted away from Hong Kong will return. Bloomberg previously reported that Bank of America and Citigroup relocated big dealmakers and senior equities staff to rival hub Singapore, which is also trying to entice more talent workers with its own visa programme.
Luring back global events
Next week alone sees the return of the Credit Suisse Asian Investment Conference, the HKMA-BIS Joint Conference of central bankers, a family office event titled Wealth for Good in Hong Kong Summit, as well as international art fair Art Basel.
Hong Kong is also hoping events such as the Rugby Sevens tournament will bring in much-needed tourists after the prolonged border closure.
The city is seeking to challenge Singapore, which snapped up some key events and exhibitions – including major wine and spirits fair Vinexpo – as Hong Kong lagged behind in its removal of Covid-19 restrictions. In 2022, Singapore hosted a slate of high-profile events including the Milken Institute Asia Summit, the Forbes Global CEO Conference and the Singapore Grand Prix.
Singapore is seeking to capitalise on its momentum with the launch of Art SG, South-east Asia’s largest-ever art fair.
[ad_2]
Source link