Hong Kong Chief Warns of Renewed Slump in 2010

Hong Kong could face a double-dip downturn in the middle of next year, because of continued uncertainties about the state of the global economy, reports the South China Morning Post, quoting Chief Executive Donald Tsang Yam-kuen.

 

"I am rather pessimistic," Tsang told the Post.  "A second trough may well emerge in the middle of next year. But we have what we need to deal with the coming situation. The aim is to work out some way to maintain people's confidence, without raising tax rates."

 

Despite Tsang's remarks, Hong Kong's retail sales value rose at a faster-than-expected double-digit rate in November, lifted by increased tourism and a continued improvement in the local economy, notes the Post. But economists warn that the growth rates will slow to the high single digits in the first quarter next year as the effect of a low comparison base fades.

 

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