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Hong Kong offers free flights after Covid isolation; Economy shrank 3.5% in 2022
Hong Kong offers free flights after Covid isolation; Economy shrank 3.5% in 2022
by AFP Staff Writers
Hong Kong (AFP) Feb 2, 2023

Hong Kong is ready to welcome the world back, its leader said Thursday, pledging more than half a million free flights and positive publicity to resurrect the once-vibrant global hub after three years of Covid-enforced isolation.

The government's rebranding campaign, "Hello, Hong Kong", bills itself as an effort to tell "good stories" about the southern Chinese city, where years of political repression, coupled with pandemic curbs, have tarnished its business-friendly reputation.

Promising "no isolation, no quarantine and no restrictions" during a speech to business and tourism heavyweights, Chief Executive John Lee announced 500,000 free air tickets for visitors to experience the city's "hustle and bustle".

The giveaway will open in March, and mainly be distributed by local airlines Cathay Pacific, HK Express and Hong Kong Airlines.

Another 80,000 tickets will be offered to residents in the summer, with the carriers yet to announce destinations.

"This, ladies and gentlemen, is probably the world's biggest welcome ever," Lee said.

Adherence to Beijing's zero-Covid doctrine of quarantine, closed borders and face masks kept Hong Kong largely virus-free until a deadly Omicron outbreak at the start of 2022.

But it also contributed to an economic recession and the exodus of more than 2.5 percent of the population.

Even as business leaders warned Hong Kong would need a full Covid exit plan before any meaningful reboot, officials insisted on gradually rolling back restrictions.

The controls closed off what was previously one of Asia's most connected cities.

Hong Kong welcomed just 600,000 visitors in 2022, less than one percent of 2018's figure.

- 'Proof will be in the pudding' -

More than 130 international companies have shuttered their Hong Kong offices over the past three years, while a recent survey of 253 Japanese firms showed securing quality workers was their top concern.

More than a quarter of the surveyed companies worried about brain drain due to the national security law Beijing imposed in 2020 to quell huge and often violent protests.

According to official figures, more than 140,000 people left Hong Kong's labour force last year, when the economy contracted by 3.5 percent.

The top US diplomat in Hong Kong, Greg May, said last week that the city's reputation as a financial centre will hinge on its ability to uphold human rights.

"Our view continues to be that Beijing's actions could further force many of the city's best and brightest to flee," he said.

Lee, a former security chief currently under US sanctions over his role in snuffing out 2019's protests, promised to correct the poor publicity he and other government officials have blamed for the metropolis's malaise.

"I will personally carry the promotional messages of our prowess as the world's freest economy and China's international financial centre."

Speaking to AFP at the campaign launch, Peter Burnett, the former chair of the British Chamber of Commerce in Hong Kong, said "the proof will be in the pudding" for the reboot.

"At least they're doing something about it. And that to me is very, very encouraging."

Hong Kong economy shrank 3.5 percent in 2022
Hong Kong (AFP) Feb 1, 2023 - Hong Kong's economy shrank by 3.5 percent in 2022, with exports plunging and the city's worst-ever coronavirus outbreak battering businesses, the government announced Wednesday, while saying it hoped China's reopening would spur a recovery.

Vast swathes of Hong Kong's economy were shut down at the start of the year, when the territory recorded one of the world's highest Covid per capita death rates as it dealt with a wave of the highly transmissible Omicron variant.

In September, the government began easing the harsh pandemic restrictions that had left Hong Kong internationally isolated and had damaged its status as a financial hub.

Gross Domestic Product (GDP) dropped all four quarters in 2022, with the final quarter seeing it fall 4.2 percent year-on-year, according to the preliminary figures released Wednesday.

"Domestic demand slackened, dragged initially by the (Omicron-fuelled Covid wave) and subsequently by tightened financial conditions," a government spokesperson said in a statement.

"Total exports of goods plunged amid the sharp deterioration in the external environment and disruptions to cross-boundary truck movements."

Hong Kong was in a deepening recession in 2019 and 2020 after the former British colony was roiled by pro-democracy protests and the start of the pandemic.

The city found brief respite in 2021, as its strict pandemic controls largely kept it virus-free, with the economy rebounding by 6.4 percent -- gains later wiped out by the outbreak at the start of 2022.

China's decision to reopen its borders in December sparked hopes of a recovery for Hong Kong, the government spokesperson said Wednesday, adding that the city's services sector would benefit from "an expected strong rebound of inbound tourism".

"An expected faster growth of the Mainland economy and the relaxation of cross-boundary truck movement restrictions should provide some support (for the exports of goods)," said the official.

Government spending was the biggest driver of Hong Kong's economic growth in 2022, increasing by 8.1 percent year-on-year.

Private consumption expenditure decreased by 1.1 percent from 2021, according to the data, while exports and imports of goods fell by 13.9 and 13.1 percent respectively.

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