Despite the shadow cast over the global economy by trade protectionism, Hong Kong’s real GDP grew by 3.1% year-on-year in the first quarter. This performance exceeded market expectations, demonstrating the city’s resilience in the face of a turbulent international trade environment.

In recent months, Hong Kong’s total export value has recorded consecutive increases. According to Financial Secretary Paul Chan, exports, investments and the stock market performed well in April and May. Chan predicted sustained growth in the stock market this year, which could bolster private consumption. Several financial institutions have since upgraded their growth forecasts for Hong Kong.

Visitor numbers have continued to rise, reaching 20 million in the first five months of the year. Arrivals from the Mainland and overseas have increased by approximately 10% and 18% year-on-year, respectively. These figures suggest that Hong Kong’s economy is beginning to show signs of improvement.

However, amid shifting consumption patterns among locals and visitors, private consumption remains sluggish. In addition to attracting more tourists, Hong Kong must also encourage visitors to stay longer. Meanwhile, the busy schedule of major concerts and sporting events at Kai Tak Sports Park is expected to draw even more visitors.

Hong Kong could take inspiration from cities in the Mainland, where national A-level tourist attractions offer free admission to concerts featuring renowned singers. Similar collaborations among tourist sites, restaurants and shops during such big-ticket events could also result in extended hotel bookings in the city.

An innovative mindset and flexibility are essential for industrial upgrading and transformation. For example, the Government’s nine measures – including the development of industrial brand tourism – have injected new momentum into the tourism sector. Although Hong Kong is home to many well-known brands, factory visits are often hindered by spatial and regulatory constraints. Authorities should eliminate these barriers by introducing more adaptable policies.

Hong Kong stands at a critical juncture in developing emerging industries and upgrading traditional sectors. With proactive efforts from the Government and the business community, along with an increasing number of investors establishing a presence here, the city is well-positioned to navigate through the storm and sail towards a brighter future.

Jeffrey Lam
jeffrey@jeffreylam.hk