China has the fiscal means to fight slowdown, says ADB president

The mainland can tap its healthy fiscal resources to reverse any economic growth slump as needed, Asian Development Bank (ADB) president Takehiko Nakao said in Beijing yesterday, while also calling for a "sustainable solution" to protests in Hong Kong.

Nakao played down any immediate threat to the city's status as a financial centre in an exclusive interview with the South China Morning Post, after attending the Asia-Pacific Economic Cooperation forum finance ministers' meeting in Beijing.

"Compared to other regions like the Middle East, Africa, Europe or Russia, Asia has been more stable geopolitically and politically," Nakao said and should "try hard" to stay so.

Asked whether a failure to resolve the protests in Hong Kong might hurt its stability, he said: "Of course, if it incurs more confusion and trouble, it would have a negative impact on the Hong Kong economy in the short term.

"We need a sustainable solution to the Hong Kong issue," he said, without elaborating.

The ADB slashed its economic growth forecast for Hong Kong by a percentage point to 2.5 per cent late last month, before the Occupy Central protests began, citing weaker retail and tourism performance.