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Friday, 16 January 2009

HK's CE warns of layoffs

HONG KONG - HONG Kong's chief executive Donald Tsang said Thursday the city faced a bleak economic outlook this year, adding that he expected more companies to close after the Lunar New Year.

During his first question-and-answer session with lawmakers this year, he said 'negative economic growth seems inevitable' in 2009 as a result of the global economic slowdown.

Mr Tsang told legislators Hong Kong's jobless rate in the fourth quarter of 2008 was above four per cent, adding that employment was a major challenge for the government.

'I am worried about the economic outlook,' he said. 'After the Chinese New Year, the market will become relatively weak and a wave of layoffs and corporate closures will take place,' he added.

Hong Kong slipped into recession in the third quarter of 2008 as the city's two pillars of financial services and exports were slammed by the credit crisis and a slowdown in demand from Europe and the United States.

The city's jobless rate rose to 3.8 per cent in the three months period to the end of November. -- AFP

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