Hong Kong

Hong Kong

Hong Kong’s new budget bets on growth to reduce ballooned fiscal deficit

Alicia García Herrero (Natixis) | Hong Kong has experienced three years of recession within the last four. The ripple effect is painful with a persistent fiscal deficit. The recent budget does not change the trend as the fiscal account (excluding bond issuance) will remain in deficit at 3.9% of GDP in FY 23/24, despite an improvement from -7.3% of GDP in FY 22/23. Hong Kong’s fiscal reserves also depleted from…

Hong Kong

Hong Kong Equity Market May Still Be A Falling Knife Without Fundamental Changes

Alicia García Herrero (Natixis) | Although the chorus of voices saying Hong Kong stocks would bottom out grew louder in the last few months of 2021, we held the view that policy risk could linger for further underperformance. Indeed, the Hang Seng Index ended the year with -14%, which was a clear divergence versus other major markets. The question now is whether this gloomy picture on Hong Kong equities might…

Hong Kong

Red capital: How Chinese Companies Wield Political Influence In Hong Kong

Heidi Wang-Kaeding via TheConversation | The pervasive influence of red capital in Hong Kong shows the impossibility of putting politics aside when doing business with China. Now, the US’s new Hong Kong Autonomy Act has shattered the illusion of Chinese political and business elites that it is sustainable to take advantage of Hong Kong’s “two systems” when “one country” undermines them.

Hong Kong neons

Why Hong Kong Will Remain An International Financial Centre, Despite New Security Law

Horace Yeung and Flora Huang via The ConversationUK | Following the introduction of a new Chinese national security law, some are questioning the sustainability of Hong Kong’s position as an international financial centre. These doubts are augmented by China’s plans to transform Hainan, another island off the southern coast of the Chinese mainland, into a free-trade hub. This further calls into question the idea that Hong Kong is irreplaceable for some.

Hong Kong

Why The US Dollar Remains Crucial For Hong Kong’s Economic Prosperity

via The Conversation | One important pillar of Hong Kong’s economy remains unchanged and outside of Chinese government control – its currency, which is pegged to the US dollar via a currency board. This could have significant benefits for the city as it tries to deal with pressing socioeconomic challenges. But this also requires more public spending from the special administrative region’s government.

Hong Kong protests

Hong Kong protests: threat to regional stability

Shaun Riordan │ The Hong Kong protests have now entered their tenth week. Over the weekend protestors are reported to have fought running battles with the police in the Metro system. The police have had recourse to batons and tear gas. The dangers for Hong Kong´s political and economic future are clear. But the dangers are much broader than Hong Kong. Markets should be watching carefully.

Facebook 's leak of users

Asian Markets: It Is All About Tencent In China

Asia has been the best performing region globally this year because of China being the best performing market and tech being the best performing sector. In Hong Kong in particular the impact of Tencent has been extra-ordinary as the largest stock in the market with a current weighting of almost 12%.

Asia rising from the ashes of collapse

Asia Rising From The Ashes Of Its Economic Collapse

This month is the 20th anniversary of the start of the Asian Financial Crisis. Over these two decades, Asian economies have changed a lot: in 1997, Chinese GDP was around $780bn, about the same size as Switzerland. Last year, the Chinese economy grew by more than that amount.


Shenzhen-Hong Kong Stock Connect: what you need to know

Wang Yuqian via Caixin | It will be another four months before the much-anticipated Shenzhen Hong Kong stock connect system finally goes online and provides another bridge between the mainland and the offshore stock markets. The stock exchanges in Shenzen and Hong Kong jointly made an announcement yesterday, providing investors with some details of how the system is going to work.