Top government officials, from Chief Executive Carrie Lam Cheng Yuet-ngor to her principal ministers, have stressed repeatedly that the anti-government protests, which have been going on for more than five months now, have taken a significant toll on our economy.
But is our economy really as bad as they claim it to be? Not quite, actually.
If one pays a visit to some of what has been described as “fallen districts” over the weekend, (i.e., the favorite shopping destinations of mainland tourists such as Mong Kok, Tsuen Wan, Yuen Long, Sheung Shui, etc.), they will probably notice the retail stores that have gone out of business are predominantly pharmacies, beauty stores and souvenir outlets, which mainly cater for mainland visitors.
On the other hand, neighborhood stores that mainly serve local residents appear to be largely unaffected.
As far as our frontline service industries are concerned, as long as they don’t rely overwhelmingly on the spending of mainland visitors, they are capable of weathering the economic downturn.
That many pharmacies, beauty stores and souvenir outlets across the city have closed down should remind us of the danger for our retail and service industries – for our entire economy – to rely too much on mainland tourists.
Nor should businesses overlook the tastes and needs of local consumers, lest they remain highly vulnerable to local political volatility in the days ahead.
Of course, the early closing of the MTR train service and the police’s iron-fist crackdown on protesters are also to blame for the current hardships which our retail and service sectors are facing.
But as long as the MTR resumes normal service hours as soon as possible, and once the police start to go easy on some of the mass demonstrations, I believe many of our citizens will be in the mood for spending again.
This article appeared in the Hong Kong Economic Journal on Nov 9
Translation by Alan Lee
[Chinese version 中文版]
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