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PressRelease.gif (2138 bytes)

September 10, 2001

CHAMBER DOWNGRADES GROWTH FORECAST

The Hong Kong General Chamber of Commerce has revised its forecast for average real growth for the whole of 2001 to just 0.7 percent. This is due to the fact that the Chamber believes there will be no real growth in the local economy in the second half of the 2001 calendar year.

This downgrade follows the release of the Government's second quarter economic report on August 31 showing just 0.5 percent growth for the quarter and expected growth of one per cent for the full year. Chamber Director Eden Woon said that the Chamber took the unusual step of giving a second revision of GDP forecast this year because of the rapid downturn of the economy and the large variation between what the Chamber sees today versus what it predicted four months ago.

The Chamber feels that it is increasingly likely that Hong Kong will have to await the New Year, after China enters the WTO, after the beginning of recovery by the US - and after a new Government Budget - before any modest recovery can be expected.

"Given the external factors now affecting the local economy, and apparent weaknesses in both domestic consumption and investment, we believe the Government's forecast of one percent growth for the year might be slightly optimistic," Chamber Chairman, Mr Christopher Cheng said.

According to the Chamber, the continuing weakness in the external trade picture, the setback to retail sales in July, and some scaling back of investment all suggest a weak outlook for the second half.

"Unemployment also appears to be on the rise slightly and that is likely to do little for confidence in the short term," Mr Cheng said.

"Ultimately, lower interest rates will have some impact, but with potential borrowers lacking in confidence and lenders continuing to take a cautious approach, it will take some time for them to give a lift to activity."

"Expectations for a US-led recovery continue to recede well in to 2002, and Europe and Japan are also weak. Of Hong Kong's major trading partners, only China is showing good growth and most of that is domestically-based."

"The Government's own full year forecast anticipates growth of only 0.6 per cent in the final six months of the year, but it is more likely to be zero, or even slightly negative if conditions deteriorate further," Mr Cheng added.


For further information, contact: Dr Eden Woon, Director, 2823-1211

 

Past Press Release

Date

Subject

2001/09/10 Chamber Downgrades Growth Forecast
2001/09/06 Joint Forum Explores Ways to Promote Closer Hong Kong / Guangdong Cooperation
2001/09/03 Housing Measures to Promote Confidence, Stability
2001/09/03 More Trade Leads Provided
2001/07/16 HKGCC Delegation Returns from North Korea
2001/06/27 HKGCC hails effort to boost SMEs
2001/06/21 Care Needed on new tax options

2001/06/16

Chamber Beijing mission returns

2001/05/28

Chamber Revises SAR GDP Forecast to 2.8%

2001/05/18

HKGCC Supports Details of Importation of Mainland IT and Financial Professionals

2001/04/24

Christopher Cheng becomes new chairman of HKGCC

2001/04/12

HKGCC hails speedy solution by government to reprographics problem

2001/03/30

HKGCC Calls for Elimination of Implementation of IPR Law to  Photocopying

2001/03/19

HKGCC Supports Entry for Mainland Professionals

2001/03/07

Chamber Welcomes Business Initiatives In 2001-2002 Budget Proposals

2001/02/22

Blossoms in 2001 - New Logo Unveiled

2001/02/15

Chamber Welcomes Appointment of New Chief Secretary, Financial Secretary

                                                        >> 2000 Press Release
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