Hong Kong Finance Chief Says Political Turmoil Hurts Economy – ABC News

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Hong Kong’s financial chief is warning that rising political turmoil could hurt economic growth in the freewheeling southern Chinese business hub.

Financial Secretary John Tsang’s comments in his annual budget speech highlight simmering tensions in Hong Kong, which has been increasingly polarized following the unsatisfactory resolution of pro-democracy protests at the end of 2014.

“Acute social conflicts will add uncertainties to the already adverse economic environment” in Hong Kong.

Tsang said he was “shocked” by a riot during the Lunar New Year holiday earlier this month, which left 130 people hurt, including 90 police officers. There were 72 arrests from the confrontation with activists’ angry over authorities’ attempts to crack down on holiday food vendors selling fishballs and other local delicacies. Protesters viewed the clampdown as an assault on local culture and evidence of Beijing’s tightening hold on the city.

Tsang said tensions would remain high as Hong Kong prepares for Legislative Council elections later this year and a by-election in four days.

“We anticipate that political disputes will only intensify over the coming months,” he said. “Politics and economics are closely intertwined. Political volatility will unavoidably impact on our economy.”

Tsang said the city’s economy expanded 2.4 percent last year, its fourth straight year of below-average growth, weighed down by the weak global conditions and rocky financial markets.

He forecast that Hong Kong’s economy, a major hub for trade with China, would grow 1-2 percent in 2016.

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Hong Kong Finance Chief Says Political Turmoil Hurts Economy – ABC News}