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The Impact of Financial Crisis on Hong Kong's Real Economy

As a highly open economy, Hong Kong is inevitably hit by the global financial crisis. Statistics in the third quarter of 2118 show that the quarter-on-quarter growth rate of GDP in Hong Kong has been negative for two consecutive quarters, and Hong Kong's economy has been confirmed to be in recession in theory. At present, the global financial crisis has not yet ended, and its impact on the global economy is still deepening. It is expected that the economic situation in Hong Kong will be more severe in the fourth quarter of 2118 and the first half of 2119. The central government recently announced 14 policies and measures to support Hong Kong's economy, suggesting that relevant departments implement them as soon as possible. Together with the Hong Kong SAR Government and Hong Kong society, the mainland will work together to push Hong Kong's economy out of recession as soon as possible and move towards a stable and healthy development track.

The extent and basic performance of Hong Kong's economy affected by the global financial crisis

As the center of this financial crisis is not in Hong Kong, the direct losses of Hong Kong investors on American subprime bonds are not great, and Hong Kong has a good economic foundation, abundant foreign exchange reserves, a relatively complete financial supervision system, experience in dealing with the Asian financial crisis, and a vast mainland market to maneuver. Therefore, on the whole, Hong Kong is not seriously affected by the global financial crisis. On the other hand, Hong Kong's economy is small, with a high degree of openness and freedom, and there are no restrictions on the inflow and outflow of funds, so it is difficult to avoid being affected by the financial crisis in major economic fields. Especially with the financial crisis evolving into a global economic crisis, developed economies such as the United States, Europe and Japan have successively fallen into recession, and the impact on Hong Kong's economy has shown a deepening trend.

As one of the major international financial centers, facing the global financial tsunami, Hong Kong has suffered the same economic impact as London and new york. The impact on various industries in Hong Kong has gradually emerged, and financial services industries such as banking and investment have slowed down, the stock market has been sluggish, and real estate has declined. In the past few years, the wealth effect caused by the over-expansion of asset value has been rapidly discouraged, and its domino effect has spread all over all walks of life, which has also hit retail consumption. Recently, the news of layoffs of financial institutions and the closure of small and medium-sized enterprises has been constantly spread, which shows that the impact is very great.

according to the latest economic data held by the economic opportunity Committee, the operating income of 11 industries in the week ending October 28th all fell by double digits compared with the normal level (except for insurance intermediaries and brokers, which fell by 9.2%), wholesale, retail and financial institutions fell by about 25%, freight services fell by 31%, construction and related activities fell by 32.8%, etc. The average decline of 11 industries was 18.7%. In addition, the number of employees in the 111 industries surveyed decreased by 2.5% at the same time, and it is expected to continue to decline by 1.8% next month.

From the above figures, it can be seen that the decline in operating income and the number of employees in the industry is very alarming, and the economic situation has deteriorated rapidly. With the economic recession, it is the general trend for enterprises to shrink and lay off employees.

A human resources company published a survey report on the employment outlook in the first quarter of next year. Of the 813 Hong Kong employers interviewed, 79% indicated that they had no intention to increase or decrease the number of employees in the coming quarter, 8% planned to increase the number of employees, and 7% planned to reduce the number of employees. After quarterly adjustment, the net employment outlook index was 3, the lowest since 2113. Among the six major industries, the net employment outlook index all fell, with the construction industry being -12, down by 19 percentage points. The seasonally adjusted index of the construction industry is -12, which is the hardest hit area. The service industry is 18, the highest among all industries, but it is also much lower than 32 in the fourth quarter of this year. In the financial, insurance and real estate industries, which should have been the "hardest hit" by the financial tsunami, the index dropped from 17 to 8.

It can be seen that the financial crisis has had a great impact on Hong Kong, and it will also show its impact on various industries in the next few years. Everyone says that the government should intervene, but the main reason is to expect the government to bail out, which is due to temporary hesitation and populism, more than the deep ideological turn. Therefore, the government should create jobs and stimulate the economy, which is certainly a short-term response; At the same time, we must also think about the direction and strategy of long-term economic development and transformation.

Many people have analyzed that the worst impact of the financial crisis on Hong Kong has not yet arrived.

I am a trader, and the trade in Hong Kong has been reduced a lot, alas. . . I hope everyone can tide over the difficulties.