CMA 2021 Annual General Meeting
President Dr Allen Shi predicts strong growth in 2021, but virus variants and tightened international credit conditions are major risks

The Chinese Manufacturers’ Association of Hong Kong (CMA) organised its Annual General Meeting today (30 September). In the meeting, President Dr Allen Shi reported the works of CMA over the past year, and shared his views on economy.

As the global economy begins to rebound in 2021, Hong Kong has started to see the light at the end of the tunnel. President Dr Shi said, “The overall situation of the Hong Kong economy in the first half of this year was slightly better than expected, but the economic recovery has remained uneven. Except for the fact that the total values of goods imports and exports have already returned to their pre-pandemic levels, other sectors such as private consumption and gross fixed capital formation have recovered only to near 90% of pre-pandemic levels. Furthermore, the values of trade-in-services remain at 40% below pre-outbreak levels, since travel restrictions are still in place.”

The recovery momentum of the global economy slows down
The manufacturing PMIs of major industrial countries have shown signs of decline in recent months. It is expected that in the future, the expansion of manufacturing in major countries will decline. This, coupled with inflation and the gradual withdrawal of stimulating monetary and fiscal policies by numerous governments, may significantly slow down the recovery momentum of the global economy. “Under these circumstances, even if Hong Kong’s goods export trade performs better, it is unlikely that there will be a double-digit growth,” said Dr Shi.

On the domestic front, Dr Shi expects that factors such as improvements in the labour market, the booming property market that strengthens investor and consumer confidence, and the assistance of electronic consumer vouchers will further lift household consumption expenditures.
Dr Shi believes that if the cross-border activity with mainland China gradually returns to normal, Hong Kong’s economy will truly break through the bottleneck, and the all-round recovery will be more balanced and sustainable.

Dr Shi predicts that the real GDP growth rate of Hong Kong in 2021 is expected to be above 6.0%, and the aggregate economic volume will roughly return to the level before the pandemic by the end of this year. “However, considering that it will take time for the inbound tourism industry to fully recover even after the reopening of borders, the domestic demand will not strongly and quickly recover due to the shadow of the pandemic, and the low base effect is fading, it is expected that Hong Kong’s real GDP in 2022 will grow at a slower pace of 3% to 3.5%,” he notes.

Two major risks worthy of industry’s attention
Even with the steady economic recovery that is now underway, the path to full recovery remains challenging. Dr Shi reminds the industry that there are two major risks worthy of attention in the future. First, the variants of the virus are spreading across various regions. Even regions with the highest vaccination rates have not been spared. A resurgence of the pandemic would hinder the recovery of global demand and pose a great threat to Hong Kong’s hopes for reconnecting with the rest of the world.

Second, a number of financial support measures by the HKSAR government, such as the electronic consumer vouchers, are set to expire over the next few months. Although the Government has recently extended the Pre-approved Principal Payment Holiday Scheme, the Hong Kong Monetary Authority has already mentioned that it is necessary to explore plans for the discontinuation of the scheme. As the international financial and credit conditions may be tightened, it is essential for the government to map out proper exit strategies that can minimise the financial risks in businesses. Hence, Dr Shi hopes that the government can continue to extend some of the support measures to meet the funding needs of enterprises, and devote more resources towards helping the industry create business opportunities and stimulating internal demand.

Encouraging vaccination and calling for the borders to re-open
The CMA has been urging the government for more than a year to re-open its borders with mainland China. “We are also the first business chamber to propose the launching of incentives such as lotteries, in order to encourage the public to get vaccinated,” said Dr Shi.

With concerted efforts by all sectors, Dr Shi is very delighted that the vaccination rate in Hong Kong has continued to grow. However, new variants of the virus keep emerging and the concept of the so-called protective barrier has changed. Dr Shi strongly urges citizens who have not been vaccinated to act quickly, in order to protect themselves before Hong Kong reconnects with the outside world. On the other hand, he believes that business sector like the CMA will continue to perform the duty of a good corporate citizen and encourage their employees to get vaccinated.

Supporting the industries to cope with emerging trends
At the meeting, Dr Shi also reported that the CMA have launched a number of new initiatives over the past year to help the industry ride out of the challenges, and transform and upgrade to grab the opportunities. These services include the “CMA e-warehouse” Facebook sales platform, a cross-border e-commerce marketing service, the “2021 Hong Kong Brands and Products Shopping Festival”, the “Hong Kong‧IN‧Brand Greater Bay” serial activities, and the CMA Testing’s technology commercialisation platform. Digitalisation has also been adopted to instil a sense of freshness into the CMA’s various business initiatives including exhibitions, professional services, training, seminars, member services as well as other activities of various scales.

Grasping opportunities from national development to overcome arduous challenges
The external economic conditions remain fragile and uncertain. Fortunately, the country’s strength and support will shelter businesses from storms regardless of the external ebb and flow. As the major business association in Hong Kong, CMA will help the industries understand the overall planning and the needs of the country, and help the enterprises to regain strength so that they can capture the opportunities presented by the nation’s development. “Hong Kong is now back onto the right track, the city will see rosy prospects if we set our sights on economic development and people’s livelihood.”

Other CMA office-bearers attending the AGM today included Permanent Honorary President Dr Ng Wang Pun, Legislative Council Representative the Hon Ng Wing Ka, Executive Vice President Dr Lo Kam Wing, Vice Presidents Mr Simon Wong, Dr Chan Kwok Man, Mr Dennis Ng Kwok On, Dr Ma Kai Yum, Mr Chan Ka Wai, Mr Lok Pak Keung and Mr Ivan Sze.

President Dr Allen Shi delivered a speech at 2021 Annual General Meeting

The CMA office-bearers posed for a photo at 2021 Annual General Meeting
(front row, left to right) Vice President Dr Chan Kwok Man, Executive Vice President Dr Lo Kam Wing, Permanent Honorary President Dr Ng Wang Pun, President Dr Allen Shi, Legislative Council Representative the Hon Ng Wing Ka, Vice Presidents Mr Simon Wong, Mr Dennis Ng Kwok On;
(back row) Vice Presidents Dr Ma Kai Yum (centre), Mr Chan Ka Wai (4th from the left), Mr Lok Pak Keung (4th from the right) and Mr Ivan Sze (3rd from the left)