Hong Kong’s finance chief has urged businesses to “flexibly innovate” and take advantage of major events such as the Olympics in the face of challenges, as he lauded the city’s “inspirational” athletes for their fighting spirit.
Financial Secretary Paul Chan Mo-po said on Sunday that the city’s economy was “relatively stable” and growing, but changing spending habits and a strong Hong Kong dollar had put pressure on private consumption.
“Even in the face of challenges, as long as companies can pool resources and flexibly innovate, including making good use of technology to bring more new breakthrough points to their business, and even create new business models, I believe they can create new opportunities,” Chan said in a weekly blog post.
“Seize the right moment to stimulate consumption, such as the recent Olympic craze, or various themed large-scale events, coupled with high-quality products and services, coupled with more promotions and discounts, to better meet the needs of consumers, which can naturally help increase business volume.”
Chan also said he would make several overseas trips in the second half of the year including to the United States.
Last week, the government said Hong Kong’s economy expanded by 3.3 per cent year on year in the second quarter on the back of strong exports, but private consumption expenditure dropped by 1.6 per cent.
Government figures released a day later also revealed that Hong Kong’s retail sales in June declined 9.7 per cent from a year ago, the fourth consecutive monthly contraction amid a trend of residents heading across the border to spend.
Chan commended Hong Kong’s athletes for bagging two gold and two bronze medals at the Paris Olympics so far, highlighting their “high-intensity training” and “years of persistence” to achieve their dreams.
He said local athletes’ fighting spirit and perseverance had become “inspirational stories” that brought “positive energy” to Hong Kong society.
“Only by persisting in adversity and low ebbs and focusing on improving your skills and yourself can you hone your calm psychological quality, keen observation and decisive execution, which are the key elements to achieve success.”
On the economy, Chan said a slew of new measures implemented with the support of the central government would help the development of local tourism and consumption-related fields.
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Hong Kong’s 2-time Olympic gold medallist Cheung Ka-long returns home
Hong Kong’s 2-time Olympic gold medallist Cheung Ka-long returns home
In June, the central government raised the duty-free threshold from 5,000 yuan (US$688) per trip to 12,000 yuan for mainland Chinese residents aged 18 or older. The limit could be further increased to 15,000 yuan, or HK$16,100, if they shopped at duty-free stores at border crossings.
A month earlier, Beijing’s National Immigration Administration expanded the solo-traveller scheme to include eight additional mainland cities, which Chief Executive John Lee Ka-chiu estimated would bring in an additional 300,000 visitors a year.
The Hong Kong Tourism Board has said that the city welcomed 21 million tourists in the first half of 2024, a 64 per cent increase year on year.
Of those, about 700,000 were overnight visitors from the Meetings, Incentives, Conventions and Exhibitions (MICE) category, marking an 80 per cent recovery from 2018.
Chan noted that visitor stays under the category were longer on average and their per capita expenditure was about 20 to 30 per cent higher compared with all inbound tourists.
“The [Hong Kong] government will continue to strengthen the development of this type of high-spending tourist source,” he said.
Chan also pointed to Lee’s trip to Cambodia, Laos and Vietnam last week as a means to expand the city’s circle of friends and business opportunities.
Lee had said his “fruitful” six-day trip included more than 30 events and resulted in 55 cooperation agreements.
Chan also said that in the second half of the year he would visit Europe, the United States, Australia and the Middle East, among others.
“These foreign visits not only consolidate investors and funds in markets that have traditionally been closely related to Hong Kong, but also strive to explore potential new markets and new sources of funds,” he said.
Chan added that Hong Kong had “outstanding international advantages” in many areas such as finance, business, culture and people-to-people exchanges, and played a unique roles in international economics and trade.
“[Hong Kong] has remained strong and resilient in different storms. We must make full use of these advantages and functions, continue to contribute to the country, and achieve better development for ourselves,” he said.
