On Thursday, Hong Kong marked the 24th anniversary of its establishment as a special administrative region of China under the “one country, two systems” framework.
In 2017, I did research from a socioeconomic perspective, comparing the Hong Kong of 1997 with the Hong Kong of 2017, or 20 years after the handover. The result disproved the perception held by some that things were better when the city was under British colonial rule. The data show that Hong Kong was in better shape in 2017 than in 1997. There was no statutory minimum wage in 1997. While Hong Kong people’s life expectancy increased by eight years for both men and women to 82 and 88 years respectively in the last 20 years, the public rental housing stock increased from 704,300 flats in 1997 to more than 760,000 flats in 2017.
However, things have been complicated in Hong Kong these last two years. Since 2019, the city has faced unprecedented economic challenges. Despite Hong Kong being in great shape in 2017 and 2018, the economic situation worsened afterward, as 2019 and 2020 were two of its most challenging years socially and economically because of the monthslong social unrest and the COVID-19 pandemic.
It is safe to conclude that Hong Kong’s economy remains resilient despite the huge challenges, showing signs of a gradual resurrection. We can take comfort in the fact that Hong Kong went through the Asian financial crisis, the SARS outbreak, the global financial crisis and the current pandemic without any significant outflow of capital
In a radio program on June 20, Hong Kong General Chamber of Commerce Chief Executive George Leung Siu-kay said that, according to the International Monetary Fund’s estimation, Hong Kong had lost HK$600 billion ($77.25 billion) under the pandemic. In order to recover, vaccination needs to advance faster so border restrictions can be lifted. As pointed out by Leung, reopening Hong Kong’s borders is crucial if we want Hong Kong’s economy to recover successfully.
There is no doubt that Hong Kong has handled COVID-19 remarkably well since it has succeeded in keeping the number of infections under control and the mortality rate is among the lowest in the world.
But it is way too early to claim victory, since new mutant strains are appearing, such as the Delta strain, which is causing most of the new infections in highly vaccinated countries like the United Kingdom, Israel, and, to a lesser extent, Spain and France. And this virus is, by its very nature, highly unpredictable.
This partial victory cannot be credited to a single party, but mainly to the collaborative effort of the Hong Kong community. The government has wisely adopted stringent but scientifically sound measures that, despite never including a full lockdown, have substantially reduced the chances of cross infection among the people.
Hong Kong residents must be praised as well since they have complied with anti-pandemic restrictions and recommendations admirably.
Now that COVID-19 seems to be under control in Hong Kong and neighboring cities, it is time for Hong Kong to reopen its borders and introduce safe “travel bubbles” to facilitate travel between safe cities and rejuvenate the economy in the region, and also reduce the quarantine requirements for fully vaccinated travelers from Europe, the United States and Asian countries.
Consequently, it is vital for Hong Kong people to get vaccinated as fast as possible so things can go back to normal soon, allowing the reopening of borders safely.
In this sense, the SAR government’s recent announcement must be applauded: From June 30, fully vaccinated Hong Kong residents testing positive for antibodies against COVID-19 will have their mandatory hotel quarantine cut to seven days instead of 14 to 21 days when they return from places not categorized as “extremely or very high risk”.
This rule can also apply to non-residents after officials firm up the details of the program.
Is there a reason to be concerned about Hong Kong’s economy? To me, there is not, since despite the hardships experienced these last two years, Hong Kong’s economy managed to grow 7.9 percent in the first quarter (the first expansion after six consecutive quarters of contraction), which is a sharp rebound, while the unemployment rate fell to 6.4 percent in the February-April period with the labor market improving as the coronavirus outbreak receded, a significant improvement from the 6.8 percent in January-March and 7.2 percent in December-February.
It is safe to conclude that Hong Kong’s economy remains resilient despite the huge challenges, showing signs of a gradual resurrection. We can take comfort in the fact that Hong Kong went through the Asian financial crisis, the SARS outbreak, the global financial crisis and the current pandemic without any significant outflow of capital.
Besides, Hong Kong is currently involved in many projects that will not only help it maintain its status as one of the world’s most important financial centers, but to enhance it, such as the Guangdong-Hong Kong-Macao Greater Bay Area development. In China’s 14th Five-Year Plan (2021-25), the central government again recognizes Hong Kong’s potential at the national level and has reaffirmed its commitment to support the HKSAR in strengthening its status as an international financial, trade and logistics hub. Hong Kong will benefit from pursuing deeper economic integration with the mainland by leveraging many initiatives while enhancing its status as one of the world’s most important financial centers.
Hong Kong may have had two bad years, but it will bounce back and emerge stronger, as it has always done in the past when facing other crises.
The author works as a fintech adviser and researcher. He has worked as a business analyst for a Hong Kong publicly listed company.
The views do not necessarily reflect those of China Daily.