The American Chamber of Commerce in Hong Kong released its 2021 Business Outlook Survey today.
The aim of this AmCham “temperature checking” survey is to garner a holistic view across many business sectors, and to focus on what Hong Kong needs to do to maintain its edge and renew confidence.
“Not a single business in Hong Kong was immune to challenges faced in 2020; COVID-19, violent protests in the streets, the promulgation of a new National Security Law or increased US-China political and trade friction,” said AmCham President Tara Joseph.
“As the calendar year clicks into 2021, AmCham companies are cautiously optimistic for the year though captions are still flashing about a long list of unresolved issues and there is a growing splinter of views over Hong Kong’s future. This makes for messier reading but suggests a trend of an evolving city,” she continued.
Below is a summary of the survey’s takeaways:
- Members expect a challenging 2021 after disruptions brought by COVID-19, violent street protests, the National Security Law, and rising US-China friction in 2020. Half of those surveyed are cautiously optimistic they will perform better in 2021, but 40 % expect the business environment to remain unstable or worsen.
- Troubled US-China relations remain the top business concern for 2021 along with Hong Kong’s fractious political situation, Hong Kong government policies, a resurgence of COVID-19 cases and the cost of doing business in HK.
- A majority of respondents feel the HK government needs to present a clear, transparent strategy when deciding on COVID related business and school closures.
- A third of those surveyed feel HK has become less competitive as an international business hub.
- Overall there are starkly opposed views on the outlook for Hong Kong throughout the survey, with some expecting business to rebound while others see risks ahead following implementation of the National Security Law.
- Some businesses have benefitted from the COVID pandemic with certain sectors outperforming while others suffer dramatically.
- Most businesses expect HK to remain as their regional headquarters for the next three years, though downsizing is already taking shape due to cost cutting and concerns over Hong Kong’s future as a major business hub.
- Greater Bay Area (GBA) is viewed as an opportunity for future profits with access to the region’s vast consumer market a key draw. However, just as many respondents view Vietnam as an increasingly important market with new opportunities arising in countries such as India.
Click here to view the results.