Burdened by over five months of civil unrest, Hong Kong has fallen into a recession, the city's financial secretary said Sunday.
"The economy has entered a technical recession, and the negative growth rate has significantly expanded," Secretary Paul Chan wrote in a blog post. "The blow to our economy is comprehensive."
Chan added that official quarterly GDP figures would be released Thursday, but that preliminary analysis shows consecutive economic contractions. It will be "extremely difficult," he wrote, for Hong Kong to reach its previously forecasted growth rate.
The bleak report coincided with chaotic demonstrations over the weekend that saw shops set ablaze and petrol bombs thrown at police, who responded heavily with water cannons and tear gas. In a statement Monday, police said that protesters overstepped the "bottom line of any civilized society." Unrest in Hong Kong, which first broke in June in opposition to a proposed extradition bill, has escalated significantly in recent months as residents continue to protest China's growing influence over the city and call for more democratic rights.
Chan on Sunday called on demonstrators to keep order and allow industry and commerce to operate freely. "Our society and the economy need to take a breather and need to get back on the road," he wrote.
<i>Police and protesters in Hong Kong on Sunday. Photo Credit: JEROME FAVRE/EPA-EFE/Shutterstock</i>
As a Chinese special administrative region since 1997, Hong Kong has enjoyed relative autonomy from Beijing in recent decades and has grown into one of the world's most significant financial and commercial hubs. In 2018, Hong Kong was home to the highest number of ultrawealthy ($30 million or more net worth) residents of any city in the world, according to Wealth-X's annual report. New York surpassed Hong Kong just slightly in 2019.
Earlier this month, Hong Kong's richest resident, Li Ka-shing, donated 1 billion Hong Kong dollars ($128 million) to support local business affected by the city's "unprecedented challenges."
"I hope that HK$1 billion donation will spark more support for the embattled [Small and Medium Enterprises]," Li said in a statement. "All suggestions are welcome and let's work together during these difficult times."
The Hong Kong government has also implemented a series of measures to help alleviate financial pains. Secretary Chan announced earlier this month a 19 billion Hong Kong dollar ($2.4 billion) relief package, which included significant rent reductions.
In announcing the recession Sunday, Chan cited plummeting tourism and retail sales figures. The number of visitors to Hong Kong fell by 37 percent in August and September, and by 50 percent in the first half of October. Tourism's decline constitutes an "emergency," Chan wrote. The decline of retail sales volume fell by 13.1 percent in July to 25.3 percent in August.
"We will continue to closely monitor the external economic situation and the political and economic situation in Hong Kong and try our best to further study the relief measures," Chan added in his Sunday blog post.
Investors, however, seem to be sticking with Hong Kong. The Hong Kong Stock Exchange's Hang Seng Index remains up more than 4 percent year-to-date.
Mark Wagman, Managing Director at MediaLink, joins Cheddar News' Closing Bell to discuss the impact of Apple's iOS security change on fellow big tech companies Facebook, Snap, and Twitter. Apple now lets iOS users opt-out of cross-app data tracking - which hurt Facebook and Snap's advertising revenue in the third quarter.
Facebook has dominated the headlines over the past week. The social media giant reported earnings on Monday, has been in the crosshairs of lawmakers and is now expected to rebrand itself as it gears up for what it calls the metaverse. Daniel Newman, Founder & Principal Analyst at Futurum Research, joins Cheddar News' Closing Bell where he discusses what we should expect to see ultimately unfold.
Amalgamated Bank is the first U.S. bank to publish science-based targets to reach net-zero greenhouse gas emissions by 2045. The bank says it will reach this goal through how it engages with customers and how it finances projects. Amalgamated Bank Chief Sustainability Officer Ivan Frishberg joined Cheddar Climate to provide more details about the bank's ambitious climate goals.
After years of dodging Congressional hearings about accusations that they have lied to the public about climate change and spread disinformation, executives from big oil companies are set to testify Thursday before a House committee. Maxine Joselow, anchor of the Washington Post's Climate 202 newsletter, joins Cheddar Climate to preview what we might hear from big oil executives, who will be testifying, and whether or not big oil companies will continue to commit to their small, climate-focused initiatives.
COP26 been dealt a blow as Chinese President Xi Jinping and Russian President Vladimir Putin, whose countries are responsible for a third of the world's annual greenhouse gas emissions, will not be in attendance. Bertrand Piccard, Chairman and Founder of the Solar Impulse Foundation, joins Cheddar Climate, where he discusses what he expects to see when the summit commences in Glasgow.
Verizon is teaming with Amazon's Project Kuiper low-orbit satellites to help improve communications and internet connectivity. Sampath Sowmyanarayan, chief revenue officer for Verizon Business, joined Cheddar to talk about the relationship with Amazon and what customers can expect from the strategic partnership. He noted that the 5G expansion via the satellite network will benefit rural communities where internet and wireless access remains difficult.
Norm Champ, Former Director of the Division of Investment Management at the SEC & Author of 'Mastering Money: How to Beat Debt, Build Wealth, and Be Prepared for Any Financial Crisis', joins Cheddar News to help break down what you need to know to find the right online brokerage.
Social media platforms TikTok, Snapchat, and YouTube are facing questions in DC about consumer protections, data security, and product safety for young users. Emily Birnbaum, tech lobbying and influence reporter at Politico, joined Cheddar to provide some background into what led to the congressional hearing and the potential outcome. Birnbaum noted that social media platforms have been attempting to distance themselves from Facebook and the ongoing bad press it garnered in recent months.
Beginning in November, fully vaccinated international travelers will be able to enter the United States after months of travel restrictions. People under the age of 18 and those from countries without easy access to vaccines will not be required to be vaccinated but all travelers will need to show negative COVID test results before entering.
