As the coronavirus continues to weigh on the global economy, Hong Kong’s external trade remains sluggish. In July 2020, the values of total exports and imports of goods dropped by 3% and 3.4% respectively. For the first seven months of the year, exports and imports fell by 6.3% and 8.5% respectively.

"You can see the computer age everywhere but in the productivity statistics,” said Robert Solow, a Nobel laureate in economics in 1987. This “productivity paradox” seems to have re-emerged, more than three decades after Solow made his remark.

The International Monetary Fund (IMF) has lowered its global growth forecast, as the Covid-19 pandemic continues to unfold, creating a more negative impact on economic activities in the first half of 2020 than originally expected. The IMF now predicts global output to shrink by 4.9% this year, 1.9 percentage points below its April forecast.

The Hong Kong economy contracted at the sharpest pace on record in the first quarter of 2020 as the Covid-19 pandemic disrupted virtually all types of economic activity in the city. The advance GDP estimate for the first three months of the year shows a year-on-year contraction of 8.9%, worse than during both the Asian Financial Crisis and the Global Financial Crisis, when the city’s economy shrank by 8.1% and 7.5% respectively at their lowest points (Figure 1).

Against the backdrop of the extraordinary measures being introduced by many governments to curb the spread of the coronavirus, and business activities coming to a halt across the world, financial institutions are busy revising their growth forecasts downwards.

The latest economic data from Mainland China reveal the hard facts that the world’s second largest economy has been severely hit by the coronavirus outbreak.

With the coronavirus, officially known as Covid-19, continuing to spread around the world, total confirmed cases globally have reached nearly 89,000 as of 2 March, with Mainland China accounting for the bulk of them. Outside Mainland China, South Korea and Italy are home to the largest outbreaks to date, followed by Iran, Japan, Germany and Singapore. More and more economies are being directly impacted by the virus, resulting in temporary shutdown of businesses and supply chain disruptions.

In his Budget address, the Financial Secretary outlined a number of measures to help businesses during these difficult times. The Chamber has compiled a table of the initiatives for members to quickly and easily see how they can benefit. We hope you find the list useful.

The Hong Kong economy, which is already in recession due to a double whammy of the Sino-U.S. trade war and social unrest, is now being buffeted by coronavirus-related disruptions. Some have compared the economic impact of the coronavirus outbreak to that of SARS in 2003, when Hong Kong was badly hit.