Upbeat consumers push up index score
(HK Edition, Alfons Chan)
2004-01-15
Hong Kong saw a dramatic turnaround in consumer confidence in the past six months as successive signs pointed to an economic pickup, showed a survey released yesterday. In a 0-100 score system, the index of Hong Kong's consumer confidence hit 81.1 last month, more than three times higher than last June's index of 23.2. MasterCard International, which has conducted the MasterIndex survey for 11 years, said the December figure is Hong Kong's second highest on record, and much more optimistic than the market's historic average of 45.2. Covering 13 markets in the Asia-Pacific region, the survey is conducted biannually in June and December, based on responses corresponding to five variables "employment, economy, regular income, stock market and quality of life. The latest survey on Hong Kong showed an optimistic outlook on all five economic factors for the first time since June 2001. Compared with the previous survey six months ago, the current index recorded substantially higher scores for all five economic factors, indicating the return of consumer confidence to the territory. After the SARS crisis ended last June, Hong Kong has seen a series of positive economic signs, including growth in retail sales, decline of the jobless rate and a leaping stock index. MasterCard International's Asia Pacific economic adviser Hedrick Wong Yuwa said he expects the territory to continue to experience economic growth in the near future. Wong said a rising and increasingly prosperous China will provide a strategic niche for Hong Kong, with advantages in its legal system and logistics sector. Hong Kong should implement policies to attract more skilled professionals to the territory, as cities with a high concentration of human capital have higher wages, rental and property value, creating an increasing returns process, Wong suggested. He anticipated the retail and travel sectors becoming increasingly important for the territory's economic growth. Meanwhile, the Chinese main-land's score rebounded significantly after consumer confidence dipped in the last report. The index for the market rose from 68 to 83.7. The Chinese economy has yet to overheat, and its current account surplus indicates savings are still in excess of investment, while corporate profit continues to rise, said Wong. The mainland will continue to be the locomotive for the Southeast Asian region in the years to come, with a rapidly expanding import market, he concluded. (HK Edition 01/15/2004 page1)
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