In the first half of 2003, an outbreak of atypical pneumonia broke out in Hong Kong, and the economy was in a gloomy cloud
The Hang Seng Index had a rapid diarrhea within 10 months. As the pneumonia epidemic in the Mainland continues to spread, the market is concerned about whether the Hong Kong economy will repeat the tragedy of “SARS”. Only economists bluntly say that Hong Kong’s economy is only worse.
The Mainland opened personal travel in 2003, which has brought about a rapid economic recovery in Hong Kong. (Profile picture)
Stocks fell 10% in the year
Recalling that on February 21, 2003, a retired professor from the Mainland who had suffered from SARS came to Hong Kong. It was regarded as the beginning of the introduction of the disease in Hong Kong. The Hang Seng Index saw an intraday low of 8,331 on April 25. 9.93% lower than that day. Although when the World Health Organization removed Hong Kong from the epidemic area on June 23 of the same year, the Hang Seng Index had risen, but the property market remained weak for a period of time, during which the residential transaction volume fell by more than 30%. It fell to an all-time low of 31.77 points.
During the four months of SARS outbreak, Cathay Pacific Airways (00293) and Sun Hung Kai Properties (00016) suffered the biggest declines among blue chip stocks. Both stocks fell by more than 26%. In terms of public stocks, China Gas (00003) had dropped 4.71%, but CLP Holdings (00002) and Power Industry (00006, then known as Hongkong Electric) rose by more than 8% and 9%, respectively.
ING Bank Greater China Economist Peng Yue pointed out that the current economic situation in Hong Kong is similar to that of “SARS” in the past, because the retail and tourism operations are currently very poor. Even if the epidemic spreads, the marginal impact will be small, but the difference between “bad and worse” will maintain Hong Kong’s forecast of a 5.8% economic decline this year.
Winter in retail tourism continues
Mai Cuicai, an associate professor in the Department of Finance and Decision at the Baptist University, also believes that the local demonstrations have not subsided and have impacted the retail, catering and tourism industries. If pneumonia spreads in Hong Kong, the down cycle of the related industries will continue for several months.
After SARS, China opened a personal tour of Hong Kong and Macau (commonly known as free travel) in mid-2003, resulting in a rapid economic recovery in Hong Kong. However, Peng Yue pointed out that the key now is not whether the mainland will provide policy support, but that Hong Kong people will hate the arrival of mainland people in Hong Kong. Mak also pointed out that even if the Mainland relaxes its freedom of travel, mainlanders may not be willing to travel to Hong Kong, and tourism confidence will take time to recover.