John Greenwood, one of the architects of the Hong Kong dollar peg to the United States dollar, yesterday warned that the Hong Kong stock market would continue to be vulnerable to further fallout from the Asian economic crisis. Mr Greenwood, who is chief economist at LGT Asset Management, said that despite a fall in Hong Kong's short-term interest rates, and less pressure on the Hong Kong dollar, that recovery in the rest of the region was still some way off. He said that the Mexican market was only now beginning to recover three years after the peso crisis. 'For the Asean countries, it would not surprise me if it takes the same amount of time,' he said. He said the weakness in the region would hamper Hong Kong's economy. 'Hong Kong will continue to suffer from the repercussions of further problems in Asia,' he said. 'This will presumably and hopefully lessen but they are nonetheless real.' As a consequence, Hong Kong interest rates were likely to stay higher than US rates and this meant that price-earnings expectations would continue to be low. He said the problem was that Hong Kong could not 'pick its neighbours'. He said the crisis in the members of the Association of Southeast Asian Nations was likely to be prolonged and that Malaysia had not begun to tackle its problems.