Hong Kong is making a high speed recovery following its reopening
Thursday, 1st June 2023
Source : Devadas Krishnadas

While the city has opened up in tandem with the abrupt termination of the futile Zero Covid policy of the Mainland, the final Covid era restrictions and travel requirements were only retired on 1st April 2023.

Having made multiple trips in recent months to take the pulse of the city, I can attest that each trip revealed an ever more livelier scene, both recreationally and commercially.

More importantly, optimism has returned and with it a reappearance of the future orientated go getter vibe.

Another pleasing feature for locals is the contraction in property prices and rentals. The property index has declined 17 percent over the past year due to falling demand from an ageing population and supply catch up.

This translates to higher disposable income which can be funnelled into consumption which bodes well for retail sectors.

Tourists, particularly the well heeled, are flooding back, with fat wallets, swelling demand for high end consumer goods and F&B.

The often mentioned rivalry between Singapore and Hong Kong is a myth as both cities compete in different contexts. Further, Singapore is a State with all the complexities and obligations that entails.

Indeed, Singapore benefits from a thriving Hong Kong.

While there has been indications of some talent can capital drain from Hong Kong to Singapore since the introduction of the National Security Law and the strain of the Covid experience, the scale is modest and the long term effects may not be altogether sticky.

Hong Kong's public market still outstrips Singapore's many fold in both size and dynamism and that has and will not change.

The key challenge for Hong Kong, after the inept leadership of Carrie Lam in managing Covid, is to rebase itself on sound governance and investment in productive infrastructure and to an extent, education reform to better equip its future generations to be globally competitive.

Beijing is too savvy to let Hong Kong shrivel. Indeed, it is in its interest to keep Hong Kong playing its unique role as the gateway for capital and commerce into the Mainland.

Hong Kong's best years are still ahead of it despite all the noise and smoke of its pre Covid political strive. There is a palpable sense that the people and businesses just want to move on and get on.

Devadas Krishnadas
Founder | Investor | Thought Leader | Strategist | Speaker |Founder | Investor | Thought Leader | Strategist | Speaker

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