The trade war between Mainland China and the United States has become increasingly fierce, with the recent announcement by the U.S. of a 10% tariff on US$300 billion worth of Chinese goods, and China even being labelled as a currency manipulator. Meanwhile, the recent demonstrations in Hong Kong have evolved into ongoing sporadic conflicts, which have seriously affected Hong Kong's economy and threatened its prosperity and stability.
In face of the current crisis, the top priority is to stop the violence and restore social order, so as to ensure that Hong Kong's long-term well-being is a primary consideration.
Acts that disrupt social order and even violence from a small group of protestors – including occupying roads, blocking traffic, vandalism, storming the Legislative Council and paralyzing the railway services – have made the social atmosphere more tense.
Many businesses, big and small, have been forced to keep their doors closed when protests have flared up nearby. This has seriously hit Hong Kong's retail sector and tarnished the city's image as an international financial and trade centre.
International rating agencies have warned that the demonstrations have affected the normal operation of Hong Kong's economy and undermined investors' confidence. If the situation persists, it may eventually lead to capital withdrawal, which will have an impact on Hong Kong's financial and fundraising position. As a result of the ripple effect, the city's competitiveness will decline, and the overall economy will also be hit.
We must work together to restore law and order, or Hong Kong could fall into a vicious circle of answering violence with violence. In addition, given the current difficult business environment, the Government should introduce measures to help local companies. For example, the 80% guarantee for loans under the Special Concessionary Measures of the SME Financing Guarantee Scheme should be increased to 100%. Consideration should also be given to increasing the insured amount of the export credit insurance, and simplifying the approval procedure for various SME funds, to support the business community.
In the midst of the external economic downturn as well as the ongoing local conflict, members of the public are forced to suffer the consequences of the small group of radical protestors, while some protestors remain dissatisfied with the Government's response and the police's approach to demonstrations.
In any case, the SAR Government must show its greatest sincerity and reflect on how to move forward to resolve social disputes and support SMEs while upholding the rule of law, with a view to taking Hong Kong out of the current impasse.