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Some
122,479 companies were dissolved, according to data from the
city's Companies Registry compiled by financial research
platform Webb-site.com. New firms incorporated in Hong Kong also
slid 17 percent, leaving the net number of new firms at a low
since 2003's SARS outbreak slammed the city's economy.
The numbers show just how tightly Hong Kong's business prospects
remain tied to mainland China, despite its aspirations as a
global financial center. Bleak as last year was, the problem for
the city's entrepreneurs - and their lenders - is that China's
growth may keep slowing, with an even more painful sting in the
tail down the line.
"We haven't seen the worst yet," said Kevin Lai, chief economist
Asia Ex-Japan at Daiwa Capital Markets in Hong Kong. "We're not
too sure what may happen to the currency, we're not sure whether
this slowdown in China will spill into some kind of a bigger
trouble or financial crisis. We're still at the very beginning
of the whole process."
Hong Kong's experience with SARS showed the city's resilience -
while thousands more firms were closed in 2003 than were
started, the city was back in business with a net 21,605 new
firms just a year later. But China's lingering economic health
problems may yet leave a deeper scar this time around.
(Editing by Kenneth Maxwell)
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