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Opinion | Why Hong Kong’s economy is more than capable of weathering the recent protest headwinds
- Tourist arrivals are not a good barometer of the state of the economy, given that inbound tourism accounts for only 3.7 per cent of Hong Kong’s GDP
- Meanwhile, Hong Kong has been growing in strength and attracting senior personnel in some areas, such as the legal sector
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Why you can trust SCMP
The protests that have gripped Hong Kong for over seven months have been credited with taking a heavy toll on the economy. The impact on the tourism sector has received particular attention – in October, for example, the number of visitors from the mainland dropped 46.9 per cent compared to the previous month.
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These stark figures are compounded by anecdotal accounts of students, academics, businesses and professionals considering leaving Hong Kong.
Hong Kong entered a technical recession in October, with government officials and other commentators warning – some with resignation, others with delight – of darker economic times to come.
Although the damage the protests have done to the fabric of our civil society is clear, the extent of the economic damage has been exaggerated. Hong Kong’s economy is far more resilient than we have assumed and will certainly rebound in the long term.
Data from the December 2019 report on the Hong Kong economy by the Census and Statistics Department and my own research with Professor Sida Liu at the University of Toronto on Chinese and foreign law firm collaborations in the Hong Kong legal sector paint a brighter picture.
First, dips in tourist rates do not amount to the economic damage that pundits claim, because tourism was never a big part of Hong Kong’s economy to begin with. According to the Census and Statistics Department, inbound tourism in 2018 accounted for a mere 3.7 per cent of Hong Kong’s gross domestic product and outbound tourism 0.8 per cent.
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