Findings spotlight sustained development momentum

HONG KONG, July 8, 2024 – (ACN Newswire) – Customary Chartered and the Hong Kong Commerce Improvement Council (HKTDC) immediately launched the Customary Chartered GBA Enterprise Confidence Index (GBAI) for the second quarter of 2024. The “present efficiency” index for enterprise exercise remained largely unchanged in Q2 at 54.1, in comparison with 54.3 in Q1, and close to its strongest degree since Q2 of 2021. The GBAI “expectations” index rose to 54.8 in Q2 from 54.0 in Q1, registering its first rise in 5 quarters. The figures stay comfortably above the 50 impartial mark, reflecting sustained expansionary momentum following a strong begin to the yr.

On the metropolis degree, Hong Kong’s “present efficiency” rose to 47.1 from 43.3, whereas “expectations” elevated to 49.7 from 44.2, getting nearer to the 50 impartial degree. Nevertheless, Guangzhou’s “present efficiency” index fell to 53.6 from 57.1 and “expectations” dropped to 56.6 from 60.6. Shenzhen posted the best “present efficiency” at 57.3 and “expectations” at 57.1.

The efficiency amongst particular business classes was various. “Retail and wholesale” (+3.9 factors for “present efficiency” and +2.6 factors for “expectations”), “monetary providers” (+15.0 factors, +10.7 factors) and “skilled providers” (+7.6 factors, +12.3 factors) all improved materially quarter-on-quarter. The Might Labour Day holidays and an early begin to the “618” on-line buying competition in all probability boosted family demand, permitting “retail and wholesale” to beat “manufacturing and buying and selling” (-0.9 factors, +0.7 factors), regardless of the latter’s stronger begin to the yr.

“Innovation and know-how” (I&T) appeared to take a success from tariff considerations, with the class’s “present efficiency” sub-index plunging to 43.9 from 57.8 beforehand, and “expectations” falling sharply to 38.1 from 54.6 in Q1. Nevertheless, the extent of confidence throughout I&T respondents different within the three key cities of Shenzhen (42.0 for “present efficiency” and 33.7 for “expectations”), Guangzhou (50.0, 59.4) and Hong Kong (63.2, 76.0). This exhibits that not all tech firms are equally susceptible to tariff hikes from international locations within the west.

Kelvin Lau, Senior Economist, Larger China, Customary Chartered, mentioned: “Throughout the survey interval, the US hiked tariffs on US$18bn value of imports from China as a part of its Part 301 overview. The identical interval additionally marked the run-up to the European Fee’s more moderen determination to impose anti-subsidy tariffs on Chinese language electrical automobiles (EVs). A few of our I&T respondents are in all probability a part of such EV and lithium battery provide chains, and their reliance on exterior demand could possibly be a lingering concern going into the US elections. That mentioned, we take consolation from Hong Kong’s I&T outperformance, which probably mirrored town’s latest innovation and know-how push through attracting strategic enterprises and associated expertise.”

New high quality productive forces supply funding catalyst

The time period “new high quality productive forces” describes China’s push to modernise its financial development mannequin by means of technological innovation and transformation. Whereas one of many predominant considerations over the push is whether or not there will probably be sufficient demand to soak up output from the rise in manufacturing capability, solely 11.7% of respondents noticed “a really excessive threat” of overinvestment and potential overcapacity in a number of the new industries, whereas a extra substantial 36.7% described this as “solely a low threat” whereas acknowledging that dangers exist.

The chance of overcapacity or macro considerations reminiscent of an unsure financial outlook didn’t deter GBA firms from upgrading gear and planning to make different enterprise investments within the subsequent 12 months. Of the respondents, 26.1% mentioned they deliberate to extend such funding materially or marginally, versus simply 6.9% planning a lower. A majority 67% opted for no change.

Irina Fan, HKTDC Director of Analysis, mentioned: “Latest financial information from Mainland China signifies that the nation’s development stays at a strong tempo to this point this yr. A higher function for Hong Kong is predicted, notably within the space of business transformation because the nation focuses on pushing by means of the brand new high quality productive forces. We additionally see room for financing and funding expectations to play catch-up.”

About the GBAI

The GBAI is the primary forward-looking quarterly survey available in the market that appears on the enterprise sentiment and synergistic results in cities and industries throughout the GBA. It’s compiled primarily based on a survey of greater than 1,000 firms within the GBA masking the manufacturing and buying and selling, retail and wholesale, monetary providers, skilled providers and innovation and know-how sectors. The index allows traders and companies to higher perceive the present enterprise local weather, gauge future efficiency prospects and formulate their market methods for the GBA.

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We’re a number one worldwide banking group, with a presence in 53 of the world’s most dynamic markets and serving purchasers in an extra 64. Our goal is to drive commerce and prosperity by means of our distinctive variety, and our heritage and values are expressed in our model promise, right here for good.

Customary Chartered PLC is listed on the London and Hong Kong Inventory Exchanges.

The historical past of Customary Chartered in Hong Kong dates again to 1859. It’s presently one of many Hong Kong SAR’s three note-issuing banks. Customary Chartered included its Hong Kong enterprise on 1 July 2004, and now operates as a licensed financial institution in Hong Kong beneath the identify of Customary Chartered Financial institution (Hong Kong) Restricted, a completely owned subsidiary of Customary Chartered PLC.

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About HKTDC

The Hong Kong Commerce Improvement Council (HKTDC) is a statutory physique established in 1966 to advertise, help and develop Hong Kong’s commerce. With 50 places of work globally, together with 13 in Mainland China, the HKTDC promotes Hong Kong as a two-way world funding and enterprise hub. The HKTDC organises worldwide exhibitions, conferences and enterprise missions to create enterprise alternatives for firms, notably small and medium-sized enterprises (SMEs), within the mainland and worldwide markets. The HKTDC additionally gives up-to-date market insights and product info through analysis reviews and digital information channels. For extra info, please go to: www.hktdc.com/aboutus. Comply with us on

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