Recovery hopes lie in second half

Top News | Jane Cheung, Moon Lam 4 Jan 2021

Hong Kong's economic recovery could speed up in the second half if large-scale vaccinations can be carried out, says Financial Secretary Paul Chan Mo-po.

Writing on his blog, Chan said Hong Kong still faces challenges in the first half of the year.

"The anti-epidemic measures have put pressure on local consumption and economic activity," he said.

"Cross-boundary and tourism activities take time to resume, which cannot improve the income and employment situation in a short period of time."

Chan said if anti-epidemic measures are sustained and large-scale vaccinations are rolled out as expected, the city's economic recovery could be faster in the second half.

He added that due to the pandemic, he also found new developments in the e-commerce sector.

"Currently, smartphones have become more prevalent and have changed our consumption behavior over the past years," Chan said.

"Due to the pandemic, we have spent more time at home, followed by a new trend of online shopping."

He took mainland retail numbers in the first three quarters of 2020 as an example,.

Chan noted that total retail sales for consumer goods have dropped 7 percent to 27.33 trillion yuan (HK$32.43 trillion), while online sales have risen nearly 10 percent to 8 trillion yuan.

Chan believes that online shopping will bring new opportunities to the market as well as challenges to traditional industries.

He advised businesses to utilize information technology platforms and system applications to seize opportunities once the economy recovers.

Meanwhile, the beauty industry said about 10,000 parlors with 56,000 employees have been forced to close for 100 days last year and demanded the government allow them to reopen before the peak season before the Lunar New Year holiday next month.

If not, up to 2,000 beauty parlors will have to shut down, Federation of Beauty Industry chairman Nelson Yip Sai-hung said.

He said the sector is willing to reopen on conditions such as shortened business hours, asking staff to take coronavirus tests and serving customers by appointment.

"We have been voluntarily adopting additional measures, including using disposable gowns and towels and limiting the number of guests at any given time," Yip said.

"We've already missed the peak season of Christmas - and the upcoming Lunar New Year holiday will be a critical moment for our survival."

He said beauty parlors were ordered to close on three occasions last year amid tightened social distancing rules, while country parks remained packed with hikers and bikers.

"It's like we have made meaningless sacrifices, with our employees living hand-to-mouth and suffering," Yip said.

Wholesale and retail sector lawmaker Shiu Ka-fai said while three rounds of employment subsidies had been given out to the beauty sector, they were barely helpful because operators still needed to pay salaries and expensive rents.



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