Briefly describe Hong Kong

Briefly describe - 1 Briefly describe Hong Kongs economy(background GDP growth rate etc Many export-dependant Asian countries have found global

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1. Briefly describe Hong Kong’s economy (background, GDP, growth rate, etc.) Many export-dependant Asian countries have found global financial crisis extremely challenging. Growth has declined and this pressurized intra-regional trade. Hong Kong's natural resources are limited, and it has to import food and raw materials. Similarly, Hong Kong is a small open economy; it depends highly upon international trade and finance. Economic performance of Hong Kong is severely affected by the global financial crisis, which reduced external demand and worsened trade position of the country. GDP of Hong Kong grew but very slowly from 207 billion (2007) to 215 billion (2008) as compared to previous years. Growth rate of the country declined from 7.1% in 2005 to 2.4% in 2008. Also, inflation grew rapidly from 0.9% in 2005 to 4.3% in 2008. However, unemployment reduced from 5.6% in 2006 to 3.5%, this can be attributed to Hong Kong’s increased integration with the Chinese economy. This integration is mainly in between trade, tourism and financial links. Moreover, following the crisis, Government of Hong Kong took several measures. It implemented them to stabilize the financial markets, ease credit conditions, provide support to enterprises, and to reduce unemployment. These measures will not only support large firms, but it will also help small and medium sized enterprises to reduce their difficulties. Due to high uncertainty, consumer spending decreased and wealth decreased simultaneously. It also, projected that economy can recover if private sector investment increases in the economy. Furthermore, government should provide timely support to both private and public sectors to help economy recover quickly. Manufacturing industry of the country moved to mainland. On the other hand, services industry flourished and is growing rapidly. From the graph, it can
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declining trend. After 2007, it decreased rapidly. Briefly identify and explain three methods intended to encourage economic growth for the typical firm in Hong Kong. (25 points) Hong Kong is renowned internationally for its position in trade and transportation. Thus strengthening and supporting its trade will help them achieve economic growth. Government of Hong Kong is providing finance to export companies and has reduced taxes to support them. These measures have provided solutions to many problems, trading sector witnessed. However, fall in external demand has posed serious threats to the trading sector. But, Hong Kong being a centre for exchange of Chinese goods to US, it has made considerable amount of money. Government has intended to provide further support to the ports and transportation facilities. This will provide employment to many
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This note was uploaded on 12/25/2010 for the course DEPTT. 2339485 taught by Professor J.khowel during the Spring '10 term at

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Briefly describe - 1 Briefly describe Hong Kongs economy(background GDP growth rate etc Many export-dependant Asian countries have found global

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