Pressure Grows on Hong Kong to Re-Open Economy as Cases Drop

Hong Kong is facing pressure to re-open restaurants and relax social-distancing measures as its outbreak wanes, but a bold easing approach carries both public health and political risks.

With new local cases showing a sustained decline -- hitting 18 on Friday -- businesses are pressing for restrictions on restaurants to be lifted quickly to boost the economy and help residents who rely on eating out due to small apartment sizes.

“Maybe by next week cases will drop to around 10 or single digits -– and then a lot of experts are taking that as a yardstick, where some social distancing measures can be relaxed,” said Lam Ching Choi, a member of Chief Executive Carrie Lam’s advisory Executive Council and medical doctor. He said that government experts are devising guidelines for restaurants to safely re-open.

“We’ll open either next week or the week after next, so we must get these measures ready,” he said. “Restaurants are quite essential for Hong Kong people because many don’t even cook at home.”

Pressure Grows on Hong Kong to Re-Open Economy as Cases Drop

Chief Executive Carrie Lam confirmed at a briefing on Friday afternoon that dine-in service would be restored first as the city eases restrictions, followed by other sectors including cinemas and beauty parlors. She asked residents to be patient and give the government about a week to monitor if the virus downtrend is persisting before allowing relaxation in rules.

She refuted earlier local media reports suggesting that any easing might not take place until the middle of next month -- after a planned mass testing blitz and the previous date of a legislative election that was delayed for a year.

Pressure Grows on Hong Kong to Re-Open Economy as Cases Drop

The dilemma on when and how to open underscores the challenges facing Hong Kong as both the pandemic and the struggle between pro-democracy groups and China delivers a double whammy to the economy. The U.S. has eliminated special trade privileges for Hong Kong and sanctioned some top leaders, while foreign businesses are closely watching to see if a China-imposed national security law will impede essential freedoms not available on the mainland.

A fast-paced re-opening would be bolder than Hong Kong’s previous practice and could allow the virus to start spreading again: During its previous wave in April, the city didn’t ease restrictions until there were 18 days of zero local virus cases. But the economic situation is also more dire now, with gross domestic product shrinking 9% in the second quarter. The unemployment rate has more than doubled to 6.1% in the past 12 months.

​Long Wait to Zero

“We are not likely to see cases fall back to zero for quite a while as there are so many asymptomatic cases in circulation -- both here in Hong Kong and overseas,” said Nicholas Thomas, associate professor in health security at the City University of Hong Kong. The mass testing exercise will also pick up more silent infections, he said.

In early July, after a long stretch of virus-free life, Hong Kong’s worst outbreak yet emerged, growing to account for more than two-thirds of its over 4,600 cases. Officials shut bars, gyms and cinemas, while banning dining-in at restaurants between the hours of 6 p.m. and 5 a.m. Masks are mandatory both indoors and outdoors in public, while public gatherings of more than two people are forbidden.

Pressure Grows on Hong Kong to Re-Open Economy as Cases Drop

The government delayed the Legislative Council election scheduled for Sept. 6, drawing criticism from both the opposition, which had hoped to make unprecedented gains, and U.S. Secretary of State Michael Pompeo, who said there was “no valid reason for such a lengthy delay.” Relaxing social-distancing measures before Sept. 6 could fuel the impression that the postponement was a political move to further disadvantage pro-democracy groups, in line with the aggressive use of the new law to detain activists.

In the near-term, officials are likely to ease restrictions only on restaurants while bars, which have been closed for over a month, are likely to stay shuttered, said advisor Lam. He added that the current wave has more local cases than the previous one, which was predominantly imported cases.

Risky Bars

“These bars are pretty risky, in the sense that once they spread, they can spread very quickly, mainly because of the behavior -- masks off, and people linger there for quite a bit of time, and it’s more crowded, and the customers like to go from bar to bar,” he said. “All that makes these bars a risky gathering place, so that makes it a bit difficult to open up the bars.”

Though government restrictions remain in place, social activity is already rising as daily cases drop. Demand for public transportation is at about 42% below pre-coronavirus levels this week, up 10 percentage points from two weeks ago, according to Moovit App Global Ltd. data. Shopping activity has risen by more than 6 percentage points to 30% lower than pre-virus levels in August, according to the ShopperTrak Traffic Index.

Pressure Grows on Hong Kong to Re-Open Economy as Cases Drop

With Hong Kong having boosted its testing and health-care facilities due to the latest outbreak, the city may be able to loosen restrictions more quickly now, said respiratory specialist Leung Chi-chiu, former chairman of the Medical Association’s advisory committee on communicable diseases.

“Faster testing and tracing may help to complement our near-100% mask-wearing to allow relaxation of social distancing earlier,” said Leung. Some measures could be relaxed if restaurants, bars and gyms introduce better hygienic measures as well as voluntary testing for workers, he said.

©2020 Bloomberg L.P.

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