Hong Kong

As our 2020 Navigator survey went live, Hong Kong’s economy was still feeling the effects of a third wave of COVID-19 in July. Since then, the government has lifted restrictions, injected more fiscal stimulus and continued to subsidise wages. These measures will boost growth, especially if borders re-open safely. Hong Kong’s financial system remains sound, too, and its goods trade will continue to benefit from mainland China’s recovery. But another wave of the pandemic, or geopolitical uncertainty, may put the brakes back on.

Hong Kong businesses get ready for an uncertain year

Hong Kong businesses are gearing up for future pandemics or other uncertainties. Despite low revenue expectations for 2021, three-quarters of the companies surveyed in the city said they are implementing changes to meet evolving domestic customer demand.

Intra-regional trade remains dominant. In regard to international expansion, markets with proven customer demand that offer access to new suppliers are preferred. Competitive pricing is seen as the primary means of combating protectionism.

Reshaping supply chains is key on the agenda, with supplier selection in 2021 based on speed of delivery, proximity to customers and stringent COVID-19 controls.

To achieve growth, half of the companies surveyed intend to increase investment in sales channels, marketing, cashflow and capital management, plus digital-only platforms. More than half have set targets to meet a range of environmental, social and governance (ESG) goals, recognising that sustainability is good for business.