More yuan business to create 30,000 jobs
A forecast leap in yuan business at Hong Kong banks points to tremendous growth opportunities by 2014, but the city could lose out if the supply of office space fails to keep up with the resulting increase in financial sector jobs, according to a study by a think tank.
HKGolden50, founded by former UBS property analyst and fund manager Franklin Lam in July, expects the economy to grow by 12.1 per cent this year and remain strong for the next two years.
The study, released yesterday, said a rapid increase in yuan deposits and tourist arrivals beginning last year had given Hong Kong a second growth spurt that would run to 2014, what it terms the 'golden five years'.
It cited an estimate by yuan analyst Jun Ma that yuan held in bank accounts in Hong Kong would surge to two trillion yuan (HK$2.44 trillion) by the end of next year and would create 30,000 jobs in the financial services sector.
Yuan business also includes trade settlement, yuan bonds sold in Hong Kong and local firms using the currency to invest on the mainland.
The study estimated that the 30,000 jobs would create demand for 4.5 million square feet of office space, but the expected supply from this year to 2015 was only about one million square feet a year.
'If Hong Kong ... does not capture the opportunities to increase the stock of offices, apartments and universities, cities like Singapore and Shanghai are likely to overtake Hong Kong as the international financial centre in Asia,' Lam said.
'Dramatic surge in rentals in office buildings in the city will increase operation cost for firms in Hong Kong. We will lose out to Singapore where the government is taking quick action to invest heavily in infrastructure,' he said. 'The Hong Kong government must take steps to increase land supply to cope with demand in office spaces.'