Business optimism in Hong Kong climbs to 16%

Only 9% of businesses expected a better situation over the coming three months in the preceding quarter.

The proportion of businesses expecting a better situation in the second quarter of the year rose to 16% from only 9% in the previous quarter, the Census and Statistics Department.

The share of businesses that project a worse situation dropped to 16% in the second quarter from 26% in the first.

“Overall business sentiment improved alongside the receding local epidemic situation with the accommodation and food services sector seeing particularly visible improvement thanks to the relaxation of some social distancing measures since mid-February,” a government spokesman said.

“Hiring sentiment of most sectors showed signs of stabilisation in tandem.”

The survey gathered views of some 570 establishments in 10 major sectors across Hong Kong. The enumeration period for the survey was held from 2 March to 13 April 2021.

Looking closely per sector, more businesses in the accommodation and food services sector, and manufacturing sector improved situation in the second quarter, compared to those that expect it to get worse.

Meanwhile, more respondents in the construction sector, transportation, storage and courier services sector expect business situations to get worse.

Similarly, “significantly” more businesses in the accommodation and food services sector expect their volume of business to increase in the second quarter, compared those in the transportation, storage and courier services sector.

Moreover, more respondents in the retail sector and transportation, storage and courier services sector expect employment to decrease.

In terms of the selling proce, most of the surveyed sectors expect it to remain unchanged during the quarter, whilst those in the construction sector expect tender prices to go down.

“Looking ahead… business sentiment can hopefully see a broader based improvement down the road if the local epidemic remains well contained,” the spokesman said.

The Government has unveiled counter-cyclical measures worth more than $120b in the 2021/22 budget to alleviate the economic hardship caused by the epidemic.

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