Uncertainties about the length and depth of the economic downturn brought by COVID-19 and the ongoing threat of trade protectionism have led the Hong Kong Trade Development Council (HKTDC) to revise its forecast for Hong Kong's export performance for 2020 to a decline of 10 percent, down from the previous prediction of a 2-percent fall, HKTDC said on Tuesday.
"The revision takes into account the latest HKTDC Export Index survey, which indicated that 82 percent of the 500 exporters surveyed forecast their total sales will drop 10 percent or more year-on-year," HKTDC Director of Research Nicholas Kwan said at a press conference.
Kwan said the COVID-19 pandemic and weak global demand are among the biggest threats to Hong Kong's exports this year according to the survey.
The survey showed that 97.5 percent of the respondents have experienced adverse shocks to their businesses because of COVID-19, including buyers purchasing less or canceling orders, delays in product delivery and logistical disruptions.
"The unprecedented and overwhelming nature of the COVID-19 outbreak can be a timely game changer to taper the disconnect between words and actions in challenging the status quo, and encourage a new phase of creativity and sustainability, while preparing the global economy for a more resilient and robust post-COVID-19 future," HKTDC Assistant Principal Economist (Global Research) Louis Chan said.
Some businesses, including e-commerce marketplaces, pharmaceutical and healthcare companies, logistics solution providers, video-conferencing solution providers and entertainment streaming and online gaming platforms, are likely to thrive in this "new normal", Chan said.
He predicted that the pandemic will accelerate automation, and artificial intelligence (AI)-driven technology will become more mainstream as the global economy and industry reboots and tilts more towards digitalization and automation.
At the same time, business-model innovations that use big-data analytics, contactless solutions and new digital channels would help traditional commercial operations, such as restaurants, last-mile delivery, health, insurance, human resources, marketing and product development, undergo digital transformation and survive the COVID-19 crisis, he pointed out.