Fashion
Billionaire Li Ka Shing said yesterday that Hong Kong’s economy is at its worst in 20 years, and warned that the city’s stock market could fall by more than half if the financial hub does not get backing from mainland China.
Mr Li, who held court with reporters for over an hour at an earnings news conference, is the latest person to sound the alarm after Moody’s downgraded Hong Kong’s sovereign credit rating at the weekend, citing its links to China’s economic slowdown.
“Today’s Hong Kong is getting worse… the worst I’ve seen in 20 years,” said Mr Li, 88, referring to the Asian financial crisis in the late 1990s. “Our home sales and retail now is worse than in the Sars period. During Sars, (the effect) was short-lived but now it is long,” he said, in a reference to the severe acute respiratory syndrome that crippled the city in 2003.
Hong Kong retail sales, which suffered their worst decline in 13 years last year, have been hit by a slump in tourists from the mainland which has been blamed in part on increasing cross-border tensions.
“If we respect tourists, no matter where they’re from, today our retail, hotels would not be this bad. So everyone has to reflect on themselves, there are a lot of issues the politicians need to reflect on how they can do better,” Mr Li said.
Last month, Hong Kong’s Financial Secretary John Tsang said”political volatility” was threatening to undermine the economy and warned disputes would intensify ahead of this year’s elections.
A former British territory, Hong Kong is ruled under a “one country, two systems” formula, but many in the city have voiced concern over what they see as increasing interference by Beijing. Mr Li, known as Superman for his deal-making savvy, said he does not think Hong Kong people want independence and urged residents to allow the city to be stable and prosperous.
Earlier, Mr Li’s ports-to-telecoms conglomerate CK Hutchison reported a net profit of HK$31.17 billion (S$5.4 billion) for last year, in its first full-year earnings report after a reorganisation last year. The company also announced a full-year dividend of HK$2.55 a share, while analysts estimated HK$2.71.
CK Hutchison shares dropped 0.3 per cent to close at HK$98.85 before it announced earnings, extending this year’s decline to 5.5 per cent. The benchmark Hang Seng Index fell 6.4 per cent last year.
