China’s reopening will boost Hong Kong markets despite weak GDP print, HKEX chairman says

17/1 2023 16:00

Hong Kong markets are set to benefit from the reopening of the Chinese economy, despite Beijing’s disappointing annual GDP growth rate in 2022, according to HKEX Chairman Laura Cha.

The Chinese GDP grew by 3% last year, the National Bureau of Statistics said Tuesday, slightly surpassing the expectations of a Reuters poll but sitting well below the official target of around 5.5%. Fourth-quarter year-on-year GDP growth was 2.9%.

With the exception of the initial onset of the Covid-19 pandemic, Tuesday’s full-year figure marked one of China’s weakest GDP prints for almost a half century, as the government’s strict “zero-Covid” containment measures weighed on activity.

Hong Kong’s Hang Seng index led losses in Asian stock markets on Tuesday following the release, but Cha told CNBC that the reopening of China’s borders at the very end of 2022 will result in a strong rebound.

“I think China, as the border opens up, the economy will grow back. There is a pent up demand there, there is a necessity, and, as China opens up and the economy continues to grow, recovering from the last two or three years, Hong Kong will definitely benefit from that as well,” Cha said on the sidelines of the World Economic Forum in Davos, Switzerland.