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The chief secretary for administration of the Hong Kong Special Administrative Region has warned that Hong Kong"s economic growth may face a "notable impact" later this year or next if a compromise in the on-going trade tensions between China and the United States is not reached soon.
Matthew Cheung Kin-chung made the comments at the 35th annual Hong Kong Dinner in London, an event celebrating the relationship between Hong Kong and the UK and promoting bilateral trade ties.
The Hong Kong official said that in the face of a trade conflict, it "must remain vigilant and respond robustly to any protectionists polices or unilateral trade restrictive measures that may affect the interest of Hong Kong".
He noted that the city"s Trade and Industry Department has set up a help desk and put in place a number of relief measures to support trade, especially the small and medium-sized enterprises.
"Trade war benefits no one," Cheung said. "Despite the challenges confronting Hong Kong, we are confident that Hong Kong will weather the storm, as proven by our track record of resilience in coping with global economic and financial fluctuations and crises in the past."
The chief secretary emphasized the importance of the one country, two systems principle which "solidly underpins Hong Kong"s continuing success.
"Under one country, Hong Kong enjoys the full benefits of having the mainland as our economic hinterland and shield," Cheung said
"The two systems allow Hong Kong to preserve our unique advantages, distinctive features and core values. These include our cosmopolitan flavor, our openness and connectivity on all fronts, our inherent institutional strengths, our rule of law, our status as a global financial center…and an international trade and logistics hub."
Hong Kong is ranked third behind New York and London in the Global Financial Centres Index.
"At this critical time, it is particularly important to reinforce the relationship with our established trading partners and, at the same time, develop new markets to broaden our development opportunities," Cheung said.
He also touched on Hong Kong as an investment destination as the city is diversifying its economy by promoting new drivers to support sustainable growth, create jobs and foster business start-ups and expansion in order to maintain its competitiveness.
"In this respect, we are moving swiftly into the financial technology (fintech) era," Cheung said.
"Fintech development is harnessing the power of Hong Kong"s strengths in finance, innovation and technology as well as legal and professional services, retailing, tourism and much more."
Moving forward, the chief secretary said, "Hong Kong"s strengths as a well-connected global business, financial and logistics hub will play an important part in our country"s far-reaching economic initiatives – the Guangdong-Hong Kong-Macao Greater Bay Area and the Belt and Road Initiative."
He cited mega transport infrastructures, the Guangzhou-Shenzhen-Hong Kong Express Rail, the Hong Kong-Zhuhai-Macao Bridge and the construction of a third runway at Hong Kong International Airport, saying the projects will "further consolidate Hong Kong"s pivotal role in the Great Bay Area for many years to come".