In order to prevent consumption from dropping, the Hong Kong Government will provide $ 10,000 to each resident of the territory.
Paul Chan, Hong Kong's finance minister, said that every resident will be able to get $ 10,000 from the government, provided he is 18 years old or more. In order to stimulate consumer activity in the domestic market of Hong Kong, the government will have to sponsor a little over 7 million people, that means it will have to spend more than $ 70 billion for this purpose. Such measures are part of a policy to reduce the economic impact of the outbreak of the coronavirus COVID-19.
The decline in consumption in Hong Kong began in the summer of 2019 during popular protests. The rapid spread of the new virus in December also made a significant contribution to the negative dynamics of public consumption. In general, over the past 2019, the indicator of retail sales in monetary terms decreased by a little more than 11%.
Uncertainty in consumer sentiment is caused by the latter’s incertitude regarding the further development of the economic consequences of the epidemic and its impact on business. In connection with this state of affairs, the expected decline in gross retail sales in Hong Kong according to the PwC study can reach 2.5% and their total volume will fall to $ 420 billion. To compensate for the economic slowdown, the government of the special administrative region decided to finance consumption.