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Hong Kong Government Lower Expectations From Its Economy’s Growth

Hong Kong reduces economic growth forecasts for this year

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Hong Kong growth might hit anywhere between 0 to 1 per cent due to protests. Pixabay

The Hong Kong government lowered its economic growth expectations on Thursday and estimated that the city’s Gross Domestic Product will grow between zero to one per cent in 2019 due to “strong economic headwinds”.

“If growth does hit 0 to 1 per cent, this will be the worst situation we have faced since 2009,” Hong Kong Financial Secretary Paul Chan Mo-po said in a press conference without directly referring to the protests as a cause.

“If Hong Kong’s economy grows in the third quarter at a similar pace to the second, the city will be technically in a recession,” he was quoted as saying by Efe news.

The technical recession would mean that the local GDP would have contracted for two consecutive quarters.

The data shows that during the first quarter, Hong Kong’s economy grew by 1.3 per cent, while in the April-June period it contracted by 0.3 per cent.

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‘Worst situation we have faced since 2009, says Hong Kong Financial Secretary Paul Chan Mo-po . Pixabay

Chan also announced on Thursday a number of measures that are not officially intended to resolve the political crisis facing the Hong Kong administration but to take precautions in the face of the coming bad economic times.

The measures included a “mini-budget” valued at 19.1 billion Hong Kong dollars ($2.44 billion).

According to the South China Morning Post, the measures also included increasing loan guarantees for small and medium-sized enterprises (SMEs) as well as lowering rents for hospitality businesses.

The British consultancy company, Capital Economics, predicted the protests’ economic impact could cause a contraction of one per cent in the third quarter, ending the year with an annual growth of 0.5 per cent.

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Hong Kong’s economy grew by only 1.3 per cent in the April-June period. Pixabay

According to Capital Economics, the most affected sector would be tourism, which contributes to around four per cent of the total GDP.

Hong Kong is witnessing the 11th consecutive week of demonstrations that erupted in June, sparked by the government’s controversial extradition bill that was later shelved by Hong Kong Chief Executive Carrie Lam after intense popular pressure.

Also Read: What Topics British Students can Research About Indian History

The controversy surrounding the now-defunct extradition bill, which would have enabled fugitives to be transferred from Hong Kong to mainland China to stand trial under the latter’s opaque legal system, has morphed into a set of wider demands for democracy in the ex-British colony.

Hong Kong’s economy would face a severe contraction that could threaten the strength of the Hong Kong dollar if the protests continued or, in the extreme case, the Chinese Army intervened, Capital Economics warned. (IANS)

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Extradition Law Protesters in Hong Kong Face Rubber Bullets, Pepper Spray and Tear Gas

Tam said the police had taken advantage of the violent acts of a small minority to use force against the majority of peaceful protesters

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Meanwhile, the English-language China Daily said in an editorial that the protesters had been "hoodwinked" into protesting by pro-democracy politicians in Hong Kong "and their foreign allies." Wikimedia Commons

Police in Hong Kong fired rubber bullets, pepper spray, and tear gas at protesters as tens of thousands of people surrounded the city’s legislature on Wednesday, in a bid to block a debate on a law allowing extradition to mainland China.

Crowds of mainly young people shouting “Withdraw the law!” and “No China renditions!” surrounded government headquarters and the Legislative Council (LegCo), which was forced to postpone a debate on the government’s changes to the Fugitive Offenders Ordinance.

Wielding umbrellas and wearing masks, protesters used metal road barriers to block off access to the LegCo chamber, charging past police in full riot gear to gain access to the street outside government headquarters in Admiralty district.

However, they were pushed back by several rounds of tear gas, with police eventually regaining control of the area on Wednesday evening. Protesters said they had one basic demand.

“We want the government to withdraw these amendments, not to pass them,” a protester who asked to remain anonymous said. “Even if we come out in force, the government will probably stick to its hardline position, but I still wanted to try.”

“Nobody should be able to say we were indifferent about this,” he said. The government called the protests a “riot,” warning that “any acts endangering public order and public safety will not be tolerated. Police will take resolute actions to restore social order and protect public safety.”

It said police “had to escalate the use of force” after protesters repeatedly charged the police cordon line, ignoring warnings to clear the area, adding that some had set fires and attacked police officers with makeshift weapons, a claim that was hotly contested on social media.

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Pro-democracy lawmakers are calling for the debate to be canceled outright and the amendments to be withdrawn. RFA

‘Excessive force’

London-based rights group Amnesty International called for an end to the use of “excessive” force by police. “The excessive response from police is fueling tensions and is likely to contribute to worsening violence, rather than end it,” Amnesty International’s Hong Kong director Tam Man-kei said in a statement.

“The ugly scenes of police using tear gas and pepper spray against overwhelmingly peaceful protesters is a violation of international law,” Tam said. “Police have a duty to maintain public order, but in doing so they may use force only when strictly necessary. Hong Kong’s police have today failed to live up to this standard.”

Tam said the police had taken advantage of the violent acts of a small minority to use force against the majority of peaceful protesters. “Tear gas and projectiles like rubber bullets are notoriously inaccurate and indiscriminate and can result in serious injury and even death,” Tam said.

A protester surnamed Au told RFA at the scene: “I wouldn’t have been able to live with myself … if I hadn’t come out today to tell the government that this is unacceptable. I would have been letting down the next generation.”

“Maybe if you do nothing because you are scared or worried, you have already affected the outcome,” she said. “At least action is a kind of outcome, and it’s better than wrestling with your conscience.”

A fellow protester surnamed Wong said people were infuriated at the attempt by the administration of chief executive Carrie Lam to railroad through LegCo amendments that will enable the ruling Chinese Communist Party to request the handover of alleged criminal suspects to face trial in mainland Chinese courts.

“Really, I think there should have been some time for debate,” Wong said. “The whole thing was rushed and forced through from the start, and the amendments were problematic in so many ways.” The clashes came after workers went on a strike called by pro-democracy politicians, students boycotted class, and many businesses closed in protest at the amendments.

LegCo President Andrew Leung announced that the scheduled date on the legal changes would now happen at an unspecified “later time.” Pro-democracy lawmakers are calling for the debate to be canceled outright and the amendments to be withdrawn.

Protests will continue

Jimmy Sham, convenor of co-organizers the Civil Human Rights Front, has said the protests and occupation will continue until Lam withdraws the planned amendments to the Fugitive Offenders Ordinance.

Civic Party lawmaker Au Nok-hin announced Leung’s decision to a waiting crowd, saying it was both good and bad news. “The good news is that the debate will now not happen at 11.00 a.m.,” he said. Democratic Party lawmaker Andrew Wan said the cancelation of the debate signaled an initial victory for the protesters.

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Democratic Party lawmaker Andrew Wan said the cancelation of the debate signaled an initial victory for the protesters. RFA

“This is your victory, isn’t it?” Wan told protesters. “But we can’t leave today, because they have to withdraw the amendments entirely.” “I really hope that everyone will show restraint, and not give the powers that be any excuse to suppress us,” he said. “This is just the beginning … this isn’t over. They must withdraw the amendment!”

A DANGEROUS JUNCTURE

Democratic Party chairman Wu Chi-wai agreed. “It should be very clear by now that Hong Kong is at a dangerous juncture,” Wu said. “We do not want any unpleasant incidents.”

“But we know that many Hong Kong citizens are waiting for Carrie Lam to withdraw this evil law, which is the only way to stop this display of public anger,” Wu said. Labour Party lawmaker Fernando Cheung said withdrawal of the proposals was now the only responsible way forward for Lam’s administration.

“At the very least, she should shelve it and resolve the crisis,” Cheung said. “Tensions are so high right now that I fear young people in Hong Kong will get hurt if she takes a hard line and requires the police to use force.”

And People Power lawmaker Raymond Chan said continuing with the LegCo debate would further inflame the situation. “Everything that is said, and every argument that is made, will motivate more Hong Kong people to come out,” Chan said. “We feel that we should not go ahead in a situation of such urgency.”

“[The delay] will also give the government more time to think … and to seriously consider withdrawing this evil law,” he said. Seven former high-ranking officials in the Hong Kong government added their voices to the growing calls for the amendments to be shelved or withdrawn.

Meanwhile, religious groups including the Catholic Diocese of Hong Kong and Buddhist, Taoist, and Muslim groups issued a joint statement calling on the government to seek a solution in a restrained and peaceful way.

‘Utterly saddened’

On the democratic island of Taiwan, President Tsai Ing-wen said she was “utterly saddened” to see rubber bullets being fired in Hong Kong.

“To the people of Hong Kong: you may feel your demands for freedom seem to fall on deaf ears, please know that all like-minded friends in #Taiwan & around the world are standing with you,” Tsai said via her Twitter account.

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Seven former high-ranking officials in the Hong Kong government added their voices to the growing calls for the amendments to be shelved or withdrawn. RFA

Johns Hopkins University politics professor Ho-fung Hung said the protests had at least demonstrated clearly to the rest of the world the strength of opposition to the rendition law in Hong Kong.

“The people of Hong Kong have uttered a resounding ‘No!’, and if the government continues to stick to its hard line, then this will be quite simply be violent coercion,” Hung wrote in a commentary aired on RFA’s Cantonese Service on Wednesday.

“If Hong Kong people hadn’t taken to the streets in huge numbers, the powers that be would be able to create the illusion that they weren’t strongly opposed to the amendments, or that they even supported it,” he said. “Taking to the streets is still important, because it serves as a strong and clear expression of public opinion,” Hung wrote.

Public anger, opposition

An estimated 1.03 million people took to the streets of Hong Kong on Sunday in a massive outpouring of public anger, but Lam merely reiterated her determination to get the proposed amendments to the extradition law through the legislature, a move critics said sparked clashes between police and protesters as most participants went home.

Critics fear the planned amendments to the Fugitive Offenders Ordinance, which will likely be waved through by a pro-Beijing majority in LegCo, pose a huge threat to Hong Kong’s way of life, which was supposed to have been protected under the “one country, two systems” framework under which the former British colony was handed back to China in 1997.

The amendment—which the ruling Chinese Communist Party wants implemented “urgently”—has sparked widespread fear that the city will lose its status as a separate legal jurisdiction, and that rights activists and dissidents in the city could be targeted by Beijing for actions deemed illegal across the internal border.

ALSO READ: Sea of Protesters Fills Hong Kong Streets over Extradition Law

Judges, lawyers, opposition politicians, rights activists, business groups, and journalists have all expressed vocal opposition to the plan, which will allow China to request the extradition of an alleged suspect from Hong Kong based on the standards of evidence that currently apply in its own courts.

The most likely jurisdiction to use the proposed provision is mainland China, which currently has no formal extradition treaty with Hong Kong, and Lam has tried to reassure people that legal safeguards will be used to safeguard the rights of suspects. But lawyers, who last week staged a silent protest at the planned amendments, say the government’s supposed safeguards are meaningless. (RFA)

Reported by Tam Siu-yin, Wong Lok-to and Wen Yuqing for RFA’s Cantonese Service, and by Qiao Long for the Mandarin Service. Translated and edited by Luisetta Mudie.