Hong Kong will ‘play it safe’ with growth figures amid US tariff war: Paul Chan Hong Kong is unlikely to significantly adjust its estimates for the economy as there are major uncertainties externally, the city’s finance chief has said, adding that export growth is expected to slow down after businesses rushed to beat US tariffs in the first quarter. Financial Secretary Paul Chan Mo-po said on Sunday that the widespread effects of the US tariff war were a major concern across the board during his recent visits to international summits. “There are major uncertainties over the economic outlook,” he told a radio programme. “The US tariffs have a huge impact, so in the near future, to play it safe, we might not readily make major changes to our gross domestic product estimates.” The United States and China started trade talks in the Swiss city of Geneva this weekend, with US President Donald Trump calling it “a very good meeting” after discussions broke off on Saturday evening. Chan had forecast in his budget in February that the economy could see full-year growth of 2 to 3 per cent. Hong Kong’s economy grew by a stronger-than-expected 3.1 per cent year on year in the first quarter, according to recent Census and Statistics Department estimates. That compared with growth of 2.5 per cent in the preceding quarter. It also outperformed an earlier market forecast of about 2.1 per cent, thanks to a surge in exports. But Chan said the momentum was unlikely to be sustained into the second quarter. “From my interactions with businesses, many foreign buyers rushed to place orders in the first quarter before the increased tariffs were implemented to avoid extra duties, so our export figures were exceptionally good in the first quarter,” Chan said. “But following that, we might not see similar extraordinary growth.” In the face of the tariff war, Chan said that although the US remained one of Hong Kong’s largest trading partners, the government would actively explore new markets in Southeast Asia, which would take time. “Hong Kong’s status as a free port is the cornerstone of its success, and we will keep it that way,” he said. Chan, who was in Italy for the Asian Development Bank’s annual meeting last week, said member states reflected the same concerns about unilateralism and US tariffs affecting global economic growth. He said countries were looking to Hong Kong as an example of attracting foreign investment and were interested in learning how to issue products such as infrastructure bonds and catastrophe bonds. In his official blog, Chan wrote that as many participants said risk diversification had become an important strategy in the complex geopolitical situation, some agreed that Hong Kong’s free-port status and an open business environment could serve as a hub for their expansion into the mainland and other Asian markets. In the radio interview, Chan said he was optimistic that the city’s financial market would continue to grow this year. “There are many mainland companies lining up to be listed [on the Hong Kong stock exchange] and many of them are very strong,” he said. “If you have good companies listed, investments will come. We also encourage them to not only be listed here but also to operate here to attract funds, businesses and talent.” Asked about Singapore rolling out tax exemptions to attract businesses, Chan said Hong Kong also offered similar incentives. “We are keeping a close eye on [Singapore] but tax revenue, which affects our cost-benefit, is also important,” he said. “We will offer competitive rates, but we will not intentionally reduce [rates] or else it might trigger unhealthy competition, which is not beneficial for either of us.” https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3309901/hong-kong-will-play-it-safe-growth-figures-due-us-tariffs-paul-chan (ICE HONG KONG)

Fonte notizia: South China Morning Post