〈China Daily, August 26, 2017〉The good news is Hong Kong’s economy is on firm ground — strong GDP growth, buoyant exports, resilient domestic consumption and full job status backed by a pick-up in global trade.

The city’s latest economic data, indeed, may be a cause for celebration, but economists have warned against self-complacency, citing, among other things, looming geopolitical risks in the region, US interest-rate woes and the possibility of local homes prices coming down as the Chinese mainland tightened its screws on capital outflows, which could cast the city’s economy into turmoil.

Hong Kong saw its economic growth exceed the 10-year average in the second quarter of this year — the third consecutive quarter of above-average expansion — prompting the government to revise its full-year economic growth forecast upwards by 1 percentage point.

In the April-to-June quarter, the SAR’s GDP grew 3.8 percent from the same period last year after the local economy went up 4.3 percent in the preceding quarter — the fastest pace of growth in nearly six years. In the first half of 2017, the economy expanded 4 percent year-on-year.

Goods exports saw remarkable growth in the second quarter, up 5.6 percent year-on-year, as an improving world economy lent weight to Asian exports. Services exports rose 2.3 percent in the same period, while private consumption grew briskly at 5.3 percent and overall investment spending firmed up 8 percent year-on-year.

Explaining the administration’s upbeat stance on the local economy, Andrew Au Sik-hung, deputy government economist, said earlier this month: “With an improving global economy and vibrant domestic demand, underpinned by a full-employment labor market and rising incomes, as well as resilient investment demand fueled by construction and infrastructure activities, we decided to raise the GDP growth rate forecast from 3 to 4 percent for the full-year of 2017.”

Financial Secretary Paul Chan Mo-po had expected the city’s economy to grow at a rate of 2 to 3 percent when he unveiled the government budget in February this year. Banking giant HSBC Group’s wholly-owned subsidiary Hang Seng Bank — one of Hong Kong’s largest commercial banks — lifted its forecast for the city’s GDP growth to 2.8 percent for 2017 following the release of the first-quarter growth figures in May.

Economists said a stable jobs market, plus a booming assets market and strong export performance, may further bolster economic growth for the rest of the year. “A strong labor market and favorable financial market conditions should continue to support household spending. We expect private consumption to remain as the main growth driver for the Hong Kong economy,” asserted Thomas Shik, acting chief economist at Hang Seng Bank.

Hong Kong’s labor market is in full-employment status, with unemployment in the second quarter holding at just 3.1 percent. Rising household disposable income is conducive to foster positive consumer sentiment that boosts private consumption expenditure.

“We expect trade growth to continue benefiting from the improvement in the external environment. There’ve been signs that growth in the Eurozone and the US may pick up this year and that growth in the Chinese mainland should remain steady,” said Shik. In its economic report in August, OCBC Wing Hang Bank said: “In the months to come, we expect exports to grow further, given sustained growth in the global economy and receding trade protectionism. A relatively weak Hong Kong dollar will support exports.”

Economists on the other side of the fence are more cautious, noting that many economic, financial and geopolitical risk factors have not been taken into account amid the rosy forecasts. Their main concern is that black swans in world financial markets may apply the brakes on market liquidity that’s fueling Hong Kong’s economic growth through the booming stock and property markets.

Hong Kong’s red-hot homes sector has been instrumental in pushing local economic growth as high assets prices spur household spending.

Local property price rises moderated to 0.7 percent in June this year, compared with a 2.7-percent hike in April, while the number of residential homes transactions fell to 3,500 in July — less than half of the 20-year average of 7,300 — according to Au.

〈Asian Post, August 24, 2017〉Thousands of public sector flats at two housing estates in Kowloon have been slated for demolition as part of plans for buildings with a higher number of units in hopes of alleviating Hong Kong's housing shortage. Some 3,200 flats in six public housing blocks up to four decades old would be redeveloped with work starting in 2020, a source close to the matter said. The new buildings will collectively house about 4,000 flats and will be ready within the next decade.

About 8,540 affected residents will be relocated to nearby estates to make way for the projects. "Although the buildings are structurally sound, we have to consider that their redevelopment potential is extremely high," the source said.

The plans come at a time when the government is grappling with a backlog of 277,800 applicants for public housing who have to wait an average of four years and eight months for a home, Housing Authority figures at the end of June showed. Authorities have admitted they face a shortfall of 44,000 public housing flats to meet building targets for the next decade.

The redevelopment of two blocks at Mei Tung Estate in Kowloon City, built between 1974 and 1983, would more than double the number of flats there from 665 to 1,900 by 2027, the source said. The other redevelopment plan, involving four blocks at Pak Tin Estate in Shek Kip Mei, would lower the number of flats there from 2,570 to 2,100 by 2025, but was the latest phase from a 2012 blueprint to eventually provide a total of 5,650 flats at the site.

The Housing Authority is expected to spend HK$36 million in relocation subsidies for families affected by the two projects. However, the source said using redevelopment as a way to boost housing supply could "only play a supporting role" in alleviating the city's shortage of flats. "Large-scale redevelopment planning will only freeze out large numbers of public flats [from the tenant waiting list], therefore it is not desirable," the source said.

〈The Standard, August 24, 2017〉Sino Land (0083) said it made a net profit of HK$5.5 billion in the year to June, up 3.28 percent from a year earlier as revenue, mainly from apartment sales, surged 31 percent year-on-year to HK$15.03 billion. Earnings per share were HK$1.19. The board has recommended a final dividend of 40 HK cents per share, bringing the total for the year to 53 HK cents together with the interim dividend of 13 cents per share.

Gross rental revenue rose 3 percent to HK$3.95 billion and net rental income was 4.2 percent higher at HK$3.49 billion, due to higher rental rates on renewal of tenancies. About 97 percent of the group's investment property portfolio was occupied. The group has five hotels and their overall business performance was affected by soft demand and a competitive business environment.

It now has a total land bank equivalent to 32.8 million square feet of floor area in Hong Kong, China, Singapore and Sydney. Of the total, 55.3 percent is earmarked for residential use, 28.7 percent for commercial and 7.4 percent for industrial purposes. It said 20.2 million sq ft are under development and 11.9 million sq ft are for investment and hotels, along with 700,000 sq ft for sale.

The group has acquired three development sites from the SAR government, together with development rights to four other sites as of end-June. Altogether, they will produce a combined 1.5 million sq ft of floor area.

〈Asian Post, August 23, 2017〉Competition among Hong Kong's luxury hotels is heating up as a newcomer enters the fray and hopes to cross swords with two major players even as the city faces a current tourism downturn. Wharf Hotel, the hotel arm of property developer Wharf Holdings, has come on board with a brand it started from scratch called Niccolo, which already has properties in other cities.

The hotel line is now set to compete locally with iconic home-grown brands such as The Peninsula and Mandarin Oriental, according to Wharf Hotel president Dr Jennifer Cronin. The first Niccolo property in Hong Kong later this year will be The Murray, a 336-room five-star hotel in Central, which will be converted from the colonial-era government office Murray Building.

Cronin said each room of The Murray will cost about HK$4,000 per night. The landmark Peninsula in Tsim Sha Tsui costs at least HK$3,780 a night while the Mandarin Oriental in Central charges a minimum of HK$3,800 a night, according to their websites.

"The Peninsula and the Mandarin Oriental started in Hong Kong and have grown into top international hotels - this is what Niccolo is planning to do," Cronin said in an exclusive interview with the Post.Wharf Hotels, which has a 14-strong property portfolio in Asia, positioned Niccolo as a high-end brand, while its existing Marco Polo hotels will be classified as upper-middle range to differentiate its products from rivals, she said.

In addition to spacious, elegant rooms - designed by famed architect Norman Foster's firm - and top restaurants, a special feature of The Murray will be an outdoor venue available for various functions. "Events could range from a special wedding to a fashion show, or a luxury car launch, with the white facade and majestic arches of The Murray in the backdrop, and St John's Cathedral on one side, and Hong Kong Park on the other," Cronin said.

Wharf bought the land and the former government building for HK$4.4 billion in 2011. "Marco Polo was well known for his China travels, but it was his father, Niccolo, who first went to the Middle

〈The Standard, August 22, 2017〉Dah Sing Banking Group (2356) said it made an interim net profit of HK$1.3 billion, up 21.1 percent from a year earlier.

The gain was driven by an improvement in operating income and substantially lower loan impairment charges.Basic earnings per share were 93 HK cents. The board recommended an interim dividend of 11 HK cents.

Net interest income was HK$1.88 billion, up 6.3 percent. The lender said growth in some of its key areas in Hong Kong, such as property lending, "remains under some pressure.'' It warned that its business is likely to be exposed to various risks in the second half, such as a possible slowdown in the housing market.

"There is a risk that Hong Kong dollar rates may rise more quickly than expected, putting more pressure on funding costs,'' it added.

Meanwhile, Dah Sing Financial Holdings (0440), the holding company of Dah Sing Banking Group, said its interim net profit surged 430 percent to HK$4.84 billion, up from HK$914 million year-on-year. A special dividend of HK$6.60 per share was declared aside from the interim dividend of 32 HK cents per share.

Earnings per share were HK$14.46. Net interest income was HK$1.89 billion, up 6.5 percent from a year earlier.

Together with the HK$3.587 billion gain from the sale of its Hong Kong life insurance business, interim profit spiked 336 percent to HK$5.177 billion.

The group expects to complete the sale of its life insurance business in Macau in the second half of the year. The group operates its general and life insurance businesses through Dah Sing Insurance Company (1976) in Hong Kong, Macau Insurance Company, and Macau Life Insurance Company. *Overset by 430.*