This story appears in the February/March 2023 issue of Forbes Asia. Subscribe to Forbes Asia
This story is part of Forbes’ coverage of Hong Kong’s Richest 2023. See the full list here.
Hong Kong’s economic growth is set to accelerate this year as the city jettisons Covid-19 curbs and reopens its borders with mainland China, bringing a return to business as usual. In 2022, tailwinds from Beijing’s zero-Covid policy, rising global interest rates and slowing demand saw GDP shrink by 3.5%, with exports posting sharp declines.
The job market continues to strengthen, with unemployment expected to stay below 3.5% this year, thanks partly to a government program over the past two years to energize domestic spending with consumption vouchers. While the fiscal deficit is expected to widen to 5.6% in 2022, there will likely be a return to budget surplus this year as the city moves away from pandemic support. Still, a deteriorating macroenvironment and global recession concerns may weigh on a full economic recovery. Meanwhile, the Hong Kong dollar is among Asia’s worst performers so far this year as some investors question whether its peg to the U.S. dollar, in place since 1983, is still relevant.