Asian Angle | As Beijing eases zero-Covid, can Hong Kong get ahead of the curve and scrap remaining rules?

With mainland China rapidly easing up on its dynamic zero-Covid policy, the critical question confronting Hong Kong now is whether it wants to get ahead of the curve by removing most (if not all) of its remaining Covid restrictions. Failure to do so may well leave Hong Kong as the last jurisdiction in the world in 2023 to still have pandemic restrictions from 2020.

There is little doubt that Covid restrictions in Hong Kong have delayed, quite unnecessarily, the economic recovery that should have occurred in the second half of the year, if not earlier. In the third quarter of the year, Hong Kong’s economy shrank by a shocking 4.5 per cent compared to a year ago. This comes after two consecutive quarters of contraction (of -3.9 per cent in the first quarter and of -1.3 per cent in the second quarter). In contrast, Singapore’s economy grew by 4.4 per cent in the third quarter, after rising 4.4 per cent and 3.8 per cent in the first and second quarters respectively.

For the year as a whole, Hong Kong’s economy is expected to shrink by about 3 per cent whereas Singapore’s is likely to grow by about 4 per cent. This difference is due almost entirely to Hong Kong clinging to pandemic restrictions far longer than necessary, as well as to China’s sluggish economic performance of 2022 – itself a consequence of zero-Covid.

Not only has Hong Kong paid a huge economic price for its failed Covid policy, but zero-Covid as practised in Hong Kong has done little to save lives or protect its healthcare system. Over a three-month period earlier this year, the Omicron wave killed 0.1 per cent of the Hong Kong population (or one in 1,000 people) despite adherence to a zero-Covid strategy. To put that tragedy into perspective, Britain and the United States each saw about 0.1 per cent of their populations die of Covid over a nine-month period in 2020 – before vaccines were available and when the coronavirus was more lethal than the Omicron variant that brought Hong Kong’s health system to its knees.