(Bloomberg) — Hong Kong’s leader pledged more relief measures in the wake of data showing that the city’s unrest drove a record decline in retail sales.
Hong Kong Chief Executive Carrie Lam told reporters Tuesday that the government would soon announce new moves to prop up the city’s flagging economy after almost six months of protests and political strife. She didn’t elaborate on what the measures would entail, saying only that they would be “targeted.”
October retail sales contracted 24.3% by value year on year, the fourth month of double-digit declines. On Monday, Financial Secretary Paul Chan told lawmakers that he expected the first fiscal year budget deficit since the early 2000s, and said that the turmoil has dragged down economic growth by some 2 percentage points this year.
Protesters and police again clashed in Hong Kong’s streets over the weekend, following a lull in violence surrounding local elections in which pro-democracy candidates secured a landslide win. Demonstrators, who initially turned out to stop legislation that would’ve allowed extraditions to mainland China, have since expanded their demands to include greater democracy and an independent inquiry into the police.
“We saw repeated scenes of violence that we didn’t wish to see,” Lam said, referring to the latest scuffles between protesters and police. “It has poured cold water on our hope that there can be a way to stop such violence, so that our economy can have a chance of revival. I hope very much that violence will stop as soon as possible.”
Lam said the new round of economic stimulus measures would be aimed at sectors that have been been “particularly challenged” through the unrest. “Overall, the way to do it is still be targeted,” she said, adding that all departments would be involved.
The new effort would follow previous stimulus measures, including a HK$19 billion ($2.4 billion) package in August. In October, Lam added another HK$2 billion in economic support and announced a raft of new polices, including loosened mortgage rules, compulsory land purchases for housing, cash for students and increased subsidies for low-income families.
Chinese President Xi Jinping and other officials in Beijing have repeatedly reaffirmed support for Lam’s government despite her historically low poll numbers. On Tuesday, Lam declined to answer questions about whether she would consider meeting further protester demands, such as calls for an independent commission of inquiry into the causes of the unrest and alleged police abuses.
“I have already responded to these demands many times,” she said. “I have nothing to add at the moment.”
Lam also condemned U.S. legislation supporting Hong Kong’s protesters as unnecessary and unwarranted, in her first comments since President Donald Trump signed two bills into law. “It creates an unstable and uncertain environment,” she said, adding that Hong Kong would follow Beijing’s lead on instituting countermeasures to retaliate against the action.
(Updates with Lam quote in fifth paragraph.)
–With assistance from Eric Lam.
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