In Focus
ECONOMY | Staff Reporter, Hong Kong

Hong Kong's ‘zero case' stance may delay opening borders past 2022

Continued travel ban may have a significant impact on the country’s GDP.

Government responses to the COVID-19 pandemic have split countries into two categories, according to new research by Jefferies.

The research found countries that fall under the "suppression" category are those that aim to minimise COVID-19 cases, whilst countries under the "elimination" category are those that aim for "zero cases".

The United States, United Kingdom, and Brazil are among the countries with a suppression strategy.

Hong Kong, with its almost total ban on inbound travel as only residents are allowed to travel, falls under the elimination category. Other countries that fall under this category are Singapore, China, New Zealand, and Australia.

Jefferies said countries with strict restrictions will have slower reopening than those implementing the suppression approach. Countries implementing a suppression strategy are more likely to open borders to each other unlike countries with elimination approach as they will find it hard to open even to those with significantly lower COVID-19 cases versus their original peak.

“Imagine a scenario where due to vaccines and social distancing, the very high case numbers in the USA and UK start to reduce. By the middle of 2021, cases in some European countries have fallen to less than 1,000 per day. That’s a marked improvement, but even at those levels, governments that take zero case approaches will not want to be seen as exposing their populations to the risk of inbound infection. As a result, they will very likely keep their travel restrictions and significant quarantines in place for some time,” Jefferies added.

Pressure from the tourism industry

Further border closure may also spell disaster for Hong Kong as travel and tourism contributed 17.6% to the country’s gross domestic product in 2019. In 2020, inbound tourist arrivals drop nearly 98% compared to 2019.

Jefferies said countries whose GDP relies on inbound tourists are pressured to open the borders early. Spain and Italy are some of the countries that have already expressed willingness to open borders for tourists.

Vaccination offers hope

Last year, the air travel bubble between Hong Kong and Singapore was scheduled but was repeatedly delayed due to a surge in COVID-19 cases.

In an interview with the South China Morning Post last December, Secretary for Commerce and Economic Development Edward Yau said he was not optimistic about resuming talks about the air travel buble between Singapore and Hong Kong. He pointed out that the presence of vaccines may be the solution for the revival of the quarantine-free travel agreements.

Jefferies said that the end of the pandemic may not be the elimination of the coronavirus, but when mortalities from COVID-19 start to resemble influenza in a typical year.

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