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Annette Chiu

An increasing number of small and medium-size enterprises (SMEs) are holding a positive view towards the business operating environment in Hong Kong, although many are still cautious, a survey has found.

The Hong Kong Productivity Council (HKPC) business operating environment index for this quarter increased 3 per cent to zero per cent, meaning half of the surveyed enterprises were optimistic while half were pessimistic.

The index is obtained by deducting the percentage of pessimists from the percentage of optimists.

HKPC general manager Vincent Li Kai-lun said opinions were split because some enterprises were hoping for an economic rebound in the second half while some were still suffering in the wake of the September 11 attacks in the United States.

'Local SMEs, in general, are adopting a 'wait and see' attitude towards Hong Kong's business operating environment in the coming quarter,' Mr Li said yesterday.

While the market opportunity index for this quarter rose 12 per cent, the result was minus 39.97 per cent, meaning about 60 per cent of those surveyed do not expect a flourishing market this quarter.

The risk assessment index was minus 21.47 per cent, despite a rise of 11 per cent.

About 50 per cent of enterprises did not expect an increase in business volume while 24 per cent predicted negative growth this year, the survey found.

When it came to business development in the coming year, 65 per cent said their existing operations would remain unchanged, and 2 per cent were considering closing their businesses.

The survey showed small and medium-size enterprises were keen to grab business opportunities in the mainland. More than 60 per cent of those surveyed either had expansion plans or had a foothold in China.

'This is the first time we included such a question in the survey. There are 66 per cent of SMEs willing to open up the China market. I think it is very encouraging,' Mr Li said.



Survey reveals SMEs cautiously optimistic over operating climate