Hong Kong is in recession; Halloween tests mask ban

A man confronting and then detained by police during a rally against police brutality in Hong Kong, China, over the weekend. The protests have taken a toll on the economy, a third-quarter report released Thursday showed. Photo by Lynn Bo Bo/ EPA-EFE

Oct. 31 (UPI) — The Hong Kong economy has fallen into recession, economists said on Halloween, a day when pan-Democrats also contested a ban on masks.

There was a 3.2 percent drop in the economy in the third quarter, consisting of July through September compared to the second-quarter ending in June, the Census and Statistics Department said Thursday.

The Hong Kong economy had “entered a technical recession,” the department noted, with the third-quarter decline being sharper than in the second quarter, when it contracted only 0.5 percent.

The recession is Hong Kong’s first since the Great Recession of 2009. It follows nearly five months of protests amid an ongoing U.S.-China trade war that has negatively affected exports and tourism.

Also, on Thursday, 23 pan-democratic lawmakers challenged the mask ban, which authorities have said was needed to identify protesters, as a two-day hearing began in High Court. Officials said that Halloween party-goers could also be asked to remove make-up Thursday night if it impedes identification.

“The blow to Hong Kong economy is multi-faceted,” Paul Chan, Hong Kong’s financial secretary, said in a blog.

“The decrease in export volume in the third quarter is expected to be over 7 percent, which is the largest quarterly fall in the past decade,” Chan wrote. “For the tourism industry, visitor arrivals recorded a single-digit fall in July but the drop steepened to almost 37 percent in August and September. The situation in October gets even worse as a sharp fall of 50 percent was recorded in the first half of the month.”

Local retail businesses have also been forced to close or open fewer hours due to the protests, he added.

The Hong Kong government officially withdrew extradition bill last week that sparked protests since June as it proposed allowing criminal suspects to be extradited to mainland China. Still, protests, which have morphed into a larger pro-democracy movement, have continued.


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