Hong Kong’s Chief Executive, John Lee, emphasized the importance of Small and Medium-sized Enterprises (SMEs) taking proactive steps to improve and reform themselves during a recent TV show. He acknowledged the challenges faced by different sectors in the current transitional period of the economy and stressed the need for both government support and self-help from SMEs.
Lee highlighted that some companies have managed to perform better than before despite the economic challenges, indicating the potential for growth and resilience within the sector. The government has predicted a 2.5-3.5 per cent GDP increase in 2024, offering a glimmer of hope for the business community.
In response to the struggles faced by SMEs, especially in terms of cash flow after the lifting of Covid-19 restrictions, Lee introduced eight measures to support them. These measures include easier loan repayment terms, injecting funds to upgrade operations, and support for exhibition organizers.
However, policy think tank Liber Research Community expressed concerns that the economic policies in the 2024 Policy Address did not adequately address the needs of people’s livelihoods, particularly in the sales sector. The group highlighted the challenges faced by retail and F&B sectors, with declining sales and business closures becoming more common.
Despite the government’s focus on enhancing foot traffic, local consumers heading north and a decrease in tourist consumption levels have impacted the sector’s recovery. Retail sales in August decreased by 11.8 per cent compared to the previous year, while restaurant receipts also saw a decline.
Several chain stores and canteens have announced closures or downsizing, further highlighting the struggles faced by businesses in Hong Kong. The need for innovative solutions and support for SMEs remains crucial in navigating the economic challenges ahead.
As Hong Kong continues to adapt to the changing economic landscape, it is essential for SMEs to embrace reform and seek opportunities for self-improvement. By leveraging government support and taking proactive steps towards growth, businesses can overcome the current challenges and thrive in the future.
