HONG KONG: Empty hotel rooms, struggling shops and even disruption at Disneyland: Months of protests in Hong Kong have taken a major toll on the city’s economy, with no end in sight.
City leader Carrie Lam has warned that the international financial hub is facing an economic crisis worse than either the 2003 SARS outbreak that paralyzed Hong Kong or the 2008 financial crisis.
“The situation this time is more severe,” she said. “In other words, the economic recovery will take a very long time.”
The private sector, in particular the tourism industry, has begun counting the cost of more than two months of demonstrations that erupted in opposition to a bill allowing extraditions to China but have morphed into a broader pro-democracy movement.
The figures are stark: Hotel occupancy rates are down “double-digit” percentages, as were visitor arrivals in July. Group tour bookings from the short-haul market have plunged up to 50 percent.
“In recent months, what has happened in Hong Kong has indeed put local people’s livelihoods as well as the economy in a worrying, or even dangerous situation,” warned Edward Yau, Hong Kong’s secretary for commerce and economic development.
The city’s tourism industry says it feels under siege.
“I think the situation is getting more and more serious,” said Jason Wong, chairman of the Travel Industry Council of Hong Kong.
The impact is so bad that travel agents are considering putting staff on unpaid leave as they try to weather the storm, he warned.
Images of increasingly violent clashes between masked protesters and police firing tear gas in the city’s streets have made global headlines, with protesters announcing new demonstrations throughout August as they press their demands.
A Hong Kong Tourism Board spokesperson said the number of forward bookings in August and September has “dropped significantly,” suggesting the economic toll will linger throughout the summer season.
A string of travel warnings issued by countries including the United States, Australia and Japan is likely to compound the industry’s woes.
Hong Kong demonstrations hit the tourist economy
Hong Kong demonstrations hit the tourist economy
- A Hong Kong Tourism Board spokesperson said the number of forward bookings in August and September has “dropped significantly,” suggesting the economic toll will linger throughout the summer season
Gold rises on Iran war safe-haven bid; firm dollar limits upside
BENGALURU: Gold prices rose on March 5, lifted by safe-haven demand amid an escalating war in the Middle East, while a stronger dollar and concerns around the US Federal Reserve’s monetary policy capped gains.
Spot gold was up 0.6 percent at $5,168.43 per ounce, as of 11:55 am Saudi time. US gold futures for April delivery were up 0.9 percent at $5,179.20.
Israel launched a large wave of strikes on Tehran on March 5, targeting what it said was infrastructure belonging to the Iranian authorities, after Iranian missiles sent millions of Israelis rushing into bomb shelters.
“On the one hand, there may be greater safe-haven demand for gold given the ongoing conflict in the Middle East. On the other hand, the risk of a prolonged period of higher energy prices that takes rate cuts off the table, and adds to the chance of rate hikes, could be capping further gains,” said Hamad Hussain, a climate and commodities economist at Capital Economics.
The US dollar rose about 0.3 percent after briefly retreating from three-month highs, as the fallout from the war roiled global markets and kept sentiment fragile.
Concerns about energy supply continued to drive up oil prices and stoke inflation fears.
Gold is considered a hedge against inflation in the long run, but also tends to thrive when interest rates are lower, as it is a non-yielding asset.
President Donald Trump, on March 4, officially nominated former Federal Reserve Governor Kevin Warsh to be the US central bank’s next chair.
US economic activity grew slightly, prices continued to increase and employment levels were stable in recent weeks, the Federal Reserve said on Wednesday in its latest “Beige Book” report.
Markets expect the Fed to keep rates steady at its next policy meeting on March 18, according to CME Group’s FedWatch tool.
Investors are looking out for the weekly US jobless claims data, due later today, and the US employment report for February on March 6 for further clues on monetary policy this year.
Spot silver rose 0.5 percent to $83.80 per ounce. Platinum gained 1.1 percent to $2,172.20, while palladium lost 0.7 percent to $1,662.07.
