Hong Kong's economy could be in for a rocky ride this year if a turnaround in the United States fails to take hold, Financial Secretary John Tsang warned on Wednesday. The southern Chinese city has reported improving economic data, including falling unemployment and stronger export figures.
But the US may suffer a "double-dip" recession when government economic stimulus measures disappear, which would hurt the financial hub, Tsang said. "Hong Kong's recovery process could still be rather bumpy going forward," he said in a statement to the city's Legislative Council. "The situation in the US is of particular concern," he added.
"If the US economy is to show a renewed collapse, it is very likely that Hong Kong's economic recovery will also be affected." The warning comes after the city's Chief Executive Donald Tsang warned last month that Hong Kong's economy could be in for a tumble by mid-2010.
He said the city's government had a reserve of 500 billion Hong Kong dollars (64 billion US), which was "enough for two years worth of expenses." The city's Gross Domestic Product grew 0.4 percent in the three months ending September 30 compared to the second quarter, according to government statistics. However, year-on-year, GDP fell 2.4 percent for the third quarter, narrowing from the 3.6 percent decline in the second quarter, the data showed.
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