Optimism among Hong Kong's small and medium enterprises (SME) has fallen to the lowest point since last year's Sars outbreak on concerns over rising oil prices, according to the latest survey by the Hong Kong Productivity Council (HKPC).
The poll conducted this month of 598 Hong Kong SMEs in a range of manufacturing and service sectors registered an overall index score of 8.1 per cent, the lowest since the measure posted 3.4 per cent in July last year, just after the Sars epidemic ended.
The index score is derived from the percentage of respondents with a positive outlook minus the percentage of those with a negative outlook. The index score of 8.1 per cent still means that Hong Kong SMEs are more bullish than pessimistic, said HKPC general manager Vincent Li Kai-lun.
'Local SMEs are cautiously optimistic about Hong Kong's business environment for the fourth quarter,' he said.
One of the main causes for the drop in business optimism is the rise in oil prices, said Mr Li. 'Most manufacturers expect the oil price increase to affect their raw material prices. There is concern whether the oil price surge will affect the global economy.'
The confidence index of SMEs in the plastics sector has steadily plunged to 5.3 per cent for this month from 20.2 per cent in January. Plastics are derived from oil.