Small and medium-sized enterprises have a pessimistic outlook for the economy, with nearly one in five saying they may shut down their business within 12 months, a survey by the Hong Kong Productivity Council shows.
Five percent of the SMEs surveyed said they may close within three months, the Hong Kong Economic Journal reported Thursday.
The latest Hong Kong SME Leading Business Index came in at 40.4, sliding for the third quarter in a row to its lowest since the third quarter of 2012.
All subindexes — profit performance, business conditions, global economy and investment tendency — showed a decline, and the one on intention to hire slid below the 50 mark, reflecting freezing of headcount.
Sectoral subindexes indicated dim prospects in manufacturing, import/export trade, wholesaling and retailing.
About two-thirds of the SMEs expected a decline in profits, which will dive an estimated 18 percent on average.
The uncertainty in the global economy and financial markets has taken its toll on the confidence of SMEs, which are facing short-term challenges that could affect their investment decisions for the medium and long term, said Kelvin Lau, senior economist at Standard Chartered Bank (Hong Kong) Ltd.
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