Hong Kong’s richest man Li Ka-shing sees ‘greater political and economic tensions’ in 2017
CK Hutchison Holdings chairman not ‘too optimistic’ ahead of chief executive race and potential interest rate rises
Hong Kong’s richest man, Li Ka-shing, said he expected the city to encounter “greater political and economic tensions” this year amid the chief executive race and potential interest rate rises.
The CK Hutchison Holdings chairman said on Thursday he was not “too optimistic” about the economic outlook.
“It is a difficult year,” he said ahead of the group’s annual dinner.
But he said he still had confidence in Hong Kong although the group would continue to diversify overseas in search of growth.
Asked about the city’s coming chief executive election, Li, who is a member of the 1,200-strong election committee that picks the leader, declined to comment on individual candidates.
But he agreed that the future chief executive must meet criteria recently set out by Beijing’s man in charge of Hong Kong affairs.
Wang Guangya, director of the State Council’s Hong Kong and Macau Affairs Office, said last week that the chief executive must love the country and Hong Kong, have obtained the trust of the central government, have the capability to govern and the support of Hong Kong people.
Meanwhile, the city’s private sector was finally given a reason to smile on Thursday as a key market indicator showed growth in the local economy in December after 21 months of declines, though the improvement was not due to a surge in output or new business.
The Nikkei Hong Kong Purchasing Managers’ Index – a gauge of the private sector’s health – jumped to 50.3 last month, up from 49.5 in November, marking the first expansion since February 2015. A reading below 50 means contraction while one above indicates growth.
The uptick was attributed to a surge in pre-production inventory in anticipation of greater demand for goods in the coming months.
“Chinese demand for Hong Kong’s products and services continued to wane [in December]. Overall client appetite remained sluggish,” IHS Markit economist Bernard Aw said. “That said, signs of improving external conditions and steadying growth in the mainland’s manufacturing sector may see Hong Kong business conditions stabilise in 2017.”
Economist and lecturer at Chinese University Stephen Wong Yuen-shan did not believe one positive PMI report was enough to say a turnaround was beginning.