29 February 2020
Protesters sit on the road in front of a Chow Tai Fook shop. Some of its stores were packed last weekend. Photo: Bloomberg
Protesters sit on the road in front of a Chow Tai Fook shop. Some of its stores were packed last weekend. Photo: Bloomberg

The overstated financial impact of Occupy Central

Better ignore the financial headlines on Occupy Central these days because they are largely overstated.

A certain economics professor estimated the pro-democracy demonstration could cost up to HK$700 billion (US$90 billion) as he figured a drop of one point on the Hang Seng Index could mean a billion dollar loss in wealth.

The Hong Kong stock market benchmark is down 600 points from the pre-civil disobedience close of 23,768 on September 26. With no blood, bullets or bombs, it is likely the index will climb back to where it was. 

Another possible upside: the market could break records if any unpopular government official resigns.

Meanwhile, homebuyers who are eyeing an autumn sale may not be too pleased to find developers selling their flats like ice-cream. Three new residential projects in Ma On Shan, Tseung Kwan O and North Point with a combined 456 units were sold out, although there were only six second-hand property transactions completed over the weekend, an eight-month low.

Is it also because of Occupy Central, or is it because there are too few property agents in Admiralty, Causeway Bay and Mong Kok?

It was reported that sales of some retail shops in the major districts dropped over 50 per cent in the golden week, and restaurants in hip locations took a similar hit over the weekend.

But it’s good to hear tourist arrivals are up 2 per cent to 800,000 in the golden week period. There are still many visitors in Tsim Sha Tsui and the Hung Hom industrial buildings.

I noticed crowds packing three Chow Tai Fook stores in Haiphong Road last weekend. Perhaps the public relations lady at the jewellery chain who criticized Occupy Central protesters in Mong Kok should think about sponsoring the movement in Canton Road to drive away customers.

When would Hong Kong people come to accept mainlanders are coming here not to buy high-end products because they could buy these in Europe or even at home? It has nothing to do with Occupy Central.

Ten days into the movement, we tend to believe the initial worry of Occupy Central’s detrimental impact on business has largely been exaggerated. One key reason, as pointed out by an acquaintance who provides daily Hong Kong updates to his multinational corporation’s headquarters, is that nothing happened in Central.

Instead many retailers and residents in Causeway Bay and Mong Kok, where the Occupy campaign spilled to, suffered many sleepless nights owing to the violence.

The people who can count their blessings are the jobless gangs and drug addicts funded, we believe, by anti-Occupy Central organisations.

One stock that may benefit from the prolonged civil disobedience campaign is MTR Corp. It has seen benefits as people switched from buses to trains because of road blocks.

It is also the first corporation Chief Executive Leung Chun-ying visited on September 29 after the tear gas attacks.

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EJ Insight writer