Mainland strength and Cepa are driving optimism, a survey of local firms has found Hong Kong business owners are growing more confident and expect a better year next year, thanks to the closer economic partnership arrangement (Cepa) with the mainland and an improving economy. A gauge of sentiment among business owners in Hong Kong improved 81 points compared with a year earlier, according to accounting firm Grant Thornton, which released the annual survey. Local businesses upbeat on their economic prospects for next year came in at 51 per cent, on a scale of minus 100 per cent to 100 per cent. This compares with negative 30 per cent the survey found a year earlier. The findings indicated a big improvement in confidence in Hong Kong compared with Singapore - which was also hit by the Sars outbreak in the first half of the year. In Singapore, confidence sunk to negative 30 per cent from negative 8 per cent a year earlier. 'The measures put forward by the Hong Kong government, such as the signing of Cepa, revived confidence in the Hong Kong business community,' a Grant Thornton spokesman said. Helping to boost confidence are recent economic statistics such as the jobless rate, which pulled back to a six-month low of 8 per cent. According to the Better Hong Kong Foundation, the economy is expected to expand 2.5 per cent this year and 5.3 per cent next year. 'Compared to Hong Kong, Singapore lacks positive news to spur the confidence of the business community,' the spokesman added. Hong Kong business owners confident their turnover would improve jumped to 44 per cent from negative 7 per cent. The gauge for profitability improved to 19 per cent from negative 27 per cent. The outlook for exports grew to 25 per cent from 7 per cent. Li Kui-wai, associate professor of economics at City University, said individual mainland tourists had stimulated consumer demand, helping to spur a cyclical recovery in the domestic economy. He said the recovery would provide opportunities for the government to tackle economic and structural problems. Sunny Ho Lap-kee, executive director for the Hong Kong Shippers' Council, expected exports to remain strong in the coming year.