Hong Kong survey highlights steady growth outlook

Core Insights - Hong Kong's financial sector remains crucial for the city's economic stability despite global uncertainties and trade disputes [1] - The strength of capital markets and financial links are identified as key factors supporting resilient business sentiment for 2026 [1] Economic Outlook - A survey conducted from 22 October to 21 November 2025 included 296 professionals, with 63% expecting modest economic growth in Hong Kong for the coming year [2] - Main factors supporting growth include tax regime (39%), capital markets (30%), and economic activity in Chinese mainland (24%) [2] Concerns and Challenges - High living expenses (28%), a slowdown in the global economy (27%), and reduced growth rates in Chinese mainland (26%) are primary concerns for 2026 [3] - Trade tensions have negatively impacted business confidence, with 51% reporting adverse effects on performance in 2025 [4] - The proportion viewing trade tensions as a major concern has increased from 9% to 20% for 2026 [5] Market Activity - Hong Kong's IPO market has seen an upturn, regaining its position as the largest global fundraising hub by Q3 [3] - Looking ahead, 66% of respondents anticipate further increases in IPO activity by 2026 [3] Government Policies - The most useful government policies identified include enhancing financial connectivity with other regions (22%) and China's 'Going Out' strategy (21%) [4] Company Strategies - In response to challenges, 24% of companies have relocated or restructured operations, with 20% moving into different markets and 19% conducting risk assessments [5] - Expansion plans are increasingly focused on domestic opportunities (32%) and Chinese mainland markets (46%) [5] Revenue Expectations - Revenue expectations have become more cautious, with only 39% predicting increases for 2026, down from 51% for the current year [6] - Additionally, 37% expect stable revenue levels [6] Investment Perspective - Hong Kong is viewed as a safe haven for international investors and businesses to manage assets and diversify risks amid geopolitical tensions [7]