Finance professionals in Hong Kong are cautiously optimistic about economic growth in 2022, according to a survey of ACCA members. The poll of 170 members in the Special Administrative Region found that 85% of respondents expect GDP to grow positively this year, with 44% anticipating growth at 0%-1.9%, 35% indicating a more optimistic 2%-3.9%, and 6% at higher than 4%.

Compared with last year’s survey, in which more than half (53%) of respondents expected negative GDP growth, the findings reflect a belief that Hong Kong’s economy has passed the worst.

In terms of the pace of recovery, around 43% of respondents expected GDP to return to pre-pandemic levels in 2023; 23% believed that it would recover before the end of 2022; 19% put their hopes on 2024; and the remaining 15% expected recovery to come in 2025 or later.

Cautious optimism

‘Hong Kong has been generally successful in containing the pandemic and has stabilised the business environment. Most respondents believe that the overall economy has bottomed out,’ says Jennifer Tan, chairman of ACCA Hong Kong.

‘Hong Kong has been generally successful in containing the pandemic and has stabilised the business environment’

‘However, given that many uncertainties still loom in the global context, such as the impact of the Omicron variant, the reopening of borders and the China-US trade disputes, respondents are cautious about the prospects for this year and tend to expect the economy to return to normal and fully recover only in 2023.’

In response to the changing economic environment, 21% of respondents thought that their enterprises would create new jobs and resume recruitment in 2022, while 34% and 21% expected increasing investment in capital projects and staff, respectively.

Stability is key

As for the most important trends that will affect industries over the next five years, the respondents put social and regulatory stability as the most important (58%), followed by digital revolution and robotic transformation (54%). They also agreed that future workplace mobility (32%), spending behaviour changes (28%) and green/sustainability concepts (22%) should not be overlooked.

Regarding the key factors that will have a positive impact on Hong Kong’s economy, the respondents’ top three expectations are the reopening of borders (72%), China’s economic rebound (45%) and the 14th Five-Year Plan and Greater Bay Area initiative (42%).

Global focus

When asked about the negative impact of the China-US trade dispute, respondents ranked the slowdown of global economic growth (53%) higher than the slowdown of mainland China’s economic growth (32%). This shows that respondents are confident in mainland China’s ability to deal with the trade dispute with the US.

‘The Hong Kong-mainland border has been closed for nearly two years and all sectors are looking forward to its reopening, which will inject new impetus into Hong Kong’s economy,’ Tan says. ‘Looking around the world, China’s achievement in overcoming the pandemic has been outstanding, and its economy is recovering ahead of the rest of the world, giving the business sector a boost of confidence.’

Dual-cycle approach

According to the 14th Five-Year Plan, mainland China’s economy is heading towards the ‘dual cycle’ model of development, with an increasingly robust economy driven by domestic demand. This will see a deeper and faster economic integration of Hong Kong and mainland China, creating new opportunities for all sectors.

‘It is advisable for the government to step up its efforts in promoting and facilitating a smooth integration, so that enterprises can better understand the 14th Five-Year Plan and grasp the opportunity to participate fully in the development of the Guangdong-Hong Kong-Macau Greater Bay Area, thereby reinforcing Hong Kong’s status as an international centre for trade, finance and economic activities,’ Tan says.

Tan also notes that having largely adapted to the pandemic, enterprises are now in a state of reinforcement and recuperation. ‘In order to prepare for the upcoming economic recovery, companies are ready to increase manpower and project investment. Opportunities always favours those who are prepared,’ she says.

‘It is time for employees to improve themselves and learn new skills, especially in the areas of digitalisation and technology, so that they can keep up with the changing world and share the rewards.’