Hong Kong is one of the world’s busiest hubs for air and sea freight © Getty Images
Hong Kong is one of the world’s busiest hubs for air and sea freight © Getty Images

Country spotlight: Hong Kong

17 April 2020

Population

7,473,651

Area

1,106km2

The helicopter view

Officially the Hong Kong Special Administrative Region of the People’s Republic of China – with a population smaller than London’s – this former British colony is just south of Shenzhen in the South China Sea.

Economic outlook

According to Bloomberg, it’s the world’s 7t​h​ largest port, built on trade and finance. It has no tariffs on imported goods, and levies excise duty on just four commodities. Half its trading value comes from China. But the triple whammy of the US-China trade war, pro-democracy protests and coronavirus sees Hong Kong’s outlook seem less certain. Last year, it entered recession for the first time in a decade.

Biggest investors

Hong Kong received $115bn in foreign investment in 2018, while 80% of investments are linked to financial activities.

Strength

The World Economic Forum ranks it 7t​h​ for global competitiveness, and it is 3r​d​ in the World Bank’s Doing Business report.

Supply chain issues

Further political unrest could encourage organisations to switch their shipments away from Hong Kong to cities like Shenzhen (with its own deepwater port), while Hong Kong’s status as the world’s busiest hub for air cargo traffic could also be under threat.

Challenges

Political unrest notwithstanding, its six-day week sees staff clock 50.1 hours a week, which is starting to be seen as unsustainable, with calls growing for better welfare protection. A ‘second wave’ of coronavirus cases has hit the economy hard, while skills shortages mean Hong Kong is the third most difficult place in the world to find good staff.

Bottom line

Doubts now surround the once-rock solid region. Further uncertainty should be expected the closer it gets to 2047 – when the ‘one country, two systems’ arrangement struck by the UK on handover expires.

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