CMA 2020 Annual General Meeting
President Dr Dennis Ng predicts Hong Kong economy won't fully recover in 2021

The Chinese Manufacturers’ Association of Hong Kong (CMA) organised its Annual General Meeting today (24 September). In the meeting, President Dr Dennis Ng reported the works of CMA over the past year, and shared his views on economy.

Hong Kong’s real GDP has suffered its biggest decline on record in the first half of the year, and it has been contracting for four consecutive quarters. President Dr Ng said, “Our economy has been plunged into the worst recession in decades due to theCOVID-19 pandemic. Whether it is private consumption, corporate investment, or external trade in goods and services, all areas have suffered a heavy blow. Hong Kong economy is unlikely to return to the pre-pandemic levels by 2021.”

Global economy remains in contraction
Dr Ng also noted that some regions have begun restarting economic activities and reopening borders as the pandemic has come under control. The manufacturing PMI in major industrial regions—such as the United States, Eurozone, and Japan—are picking up. Still, as the world slowly emerges from the pandemic, the global economy remains in contraction. Among major economies, only China may see slight GDP growth. 

Of much greater concern is the intensification of disputes between China and the United States. While the Trump administration is revoking Hong Kong’s special status, Dr Ng foresees a single-digit drop in Hong Kong’s exports of goods in the next few months.

Recovery depends on virus control
Although the city’s third wave of COVID-19 infections has been largely under control, plans for an economic restart and opening to the outside world have been delayed. It is expected that inbound tourism will remain suspended for a few more months, inevitably dragging down the overall performance of service exports. “Additionally, the outlook for the labour market is not optimistic, hindering the recovery of local consumption,” said Dr Ng.

Fortunately, relief measures introduced by the SAR government have assisted enterprises in alleviating short-term capital turnover difficulties, which may curb large-scale business closures and layoffs. Likewise, several key factors, including the implementation of super-loose monetary policies by major central banks, the return of US-listed Chinese concept stocks, and the introduction of the Wealth Management Connect Scheme, have worked together to attract capital flows into Hong Kong. This may help maintain asset market stability, lessening risks arising from the negative wealth effect precipitated by the pandemic and recession. Dr Ng said, “However, the outlook for domestic demand performance is largely subject to how the local pandemic situation evolves and the government’s timetable for the reopening of economy.”

Double hit by uncertainties of the global economy and the pandemic, Dr Ng predicts that the real GDP growth rate in 2020 will drop to as low as -7%, “If we fully contain the outbreak, Hong Kong’s GDP may return to a growth range of 2 to 3% in 2021 but still below the pre-outbreak levels.”

Supporting the industries through the crisis
The escalating and prolonged pandemic situation hit everyone, but it will be harder for manufacturers and traders who are under the twin pressures of the trade war and COVID-19. Dr Ng said CMA has maintained close communication with industry stakeholders and urged the government to provide more support to manufacturing and trading industries.
To help its members adapt to the new normal of business, CMA organised dozens of webinars in the past few months. “e-warehouse”, a new platform on Facebook, has been launched to provide an additional sales channel for CMA members, motivating them to embrace digital transformation. “Considering that expositions are effective to generate vital cashflow for SMEs, we are hopeful the Hong Kong Brands and Products Expo (HKBPE) will be held in the last quarter as scheduled.”

China is the first country to recover in the global pandemic. Dr Ng urged Hong Kong manufacturers to make good use of their close connection with the Mainland market, leveraging on the opportunities arising from the new national strategy of enhancing “domestic economic circulation”. He also noted that CMA is working on a research and promotion project in the Greater Bay Area market to help Hong Kong businesses to tap into the growing opportunities in the region and it is expected that the project deliverables will begin to commence by end of the year.“The business sector hopes the governments of Hong Kong and Guangdong could press ahead with the implementation of mutual recognition system for health codes and ‘travel bubble’ to facilitate cross-border business.”

Joining hands to fight COVID-19
CMA has upheld its social responsibility under pandemic. In addition to the mask donation to frontline medical workers, CMA had also joined hands with CMA Testing to provide free Indoor Environment Hygiene Quality testing and inspection services for schools. Finally, over 400 schools have benefited from the programme.

Dr Ng also reported the major activities over the past year, including the successful staging of “54th HKBPE”, the rebranding of CMA Testing, as well as a series of commemorative activities in celebration of the 70th anniversary of the founding of the PRC and the 85th anniversary of CMA. He announced the launch of a database housing thousands of archival records relating to CMA and Hong Kong’s manufacturing industry.
Calling for unity to overcome the unprecedented challenges
A look back at his presidency, Dr Ng said Hong Kong has experienced increasingly severe tests in the past two years, beyond what he could have ever foreseen, “Having the opportunity to lead the CMA in contributing more to Hong Kong and the industry has been an invaluable and rewarding experience for me.”
Dr Ng believes the introduction of national security legislation could help curb disorder and promote the safety and stability of Hong Kong. Meanwhile, the impact of sanction threats should not be overlooked. CMA will support government efforts to promote Hong Kong, especially Hong Kong Brands, which could serve as a future direction for rebuilding the city’s image and international confidence. Dr Ng encouraged the industry to fully use the resources provided by CMA, “by working together, we can rise to any challenge and prevail.”

Other CMA office-bearers attending the AGM today included Permanent Honorary President Mr Irons Sze, Legislative Council Representative the Hon Ng Wing Ka, First Vice President Dr Shi Lop Tak, Second Vice President Mr Marvin Hsu, Vice Presidents Mr Ng Ching Wun, Mr Simon Wong, Dr Chan Kwok Man, Dr Wong Chun, Dr Lo Kam Wing, Mr Dennis Ng Kwok On, Dr Ma Kai Yum, and CEO Mr Raymond Young.

President Dr Dennis Ng delivered a speech at 2020 Annual General Meeting

The CMA office-bearers posed for a photo at 2020 Annual General Meeting.
(front row, left to right) Second Vice President Mr Marvin Hsu, Legislative Council Representative the Hon Ng Wing Ka, President Dr Dennis Ng, Permanent Honorary President Mr Irons Sze, First Vice President Dr Shi Lop Tak, Vice President Mr Ng Ching Wun
(back row, left to right) Vice Presidents Dr Ma Kai Yum, Dr Lo Kam Wing, Dr Chan Kwok Man, Mr Simon Wong, Dr Wong Chun, Mr Dennis Ng Kwok On, and CEO Mr Raymond Young