Dozens spoke at the meeting including a securities industry worker surnamed Law who expressed concern that bankruptcies among brokerage firms had reached a double-digit figure in recent years and questioned whether government efforts to attract foreign investment had yielded results.
Another attendee, a manufacturing industry employee named Yip, asked if low-interest financing schemes were available to help firms when banks adopted a “conservative and passive” approach to lending.
Lee said when concluding the session: “We estimate the economy will perform better next year. Those betting against Hong Kong in the long run will be the first to lose.
“In this transitional period, certain fields will face challenges in adapting to changes.
“In particular, for small and medium-sized enterprises, we will listen to their voices and help them.”
The city’s leader pointed to external uncertainties linked to the coming US presidential election, high interest rates and regional tensions.
He said he had heard that many businesspeople were hesitant to make big moves or invest heavily at this time.
Without detailing any potential policies, Lee said he believed the situation would improve as the global economy shifted East towards markets such as Southeast Asia.
Figures released on Friday showed the city’s economy expanded by 3.3 per cent year on year in the second quarter, with the government expressing confidence that full-year growth would meet its target of between 2.5 and 3.5 per cent.
Hong Kong is home to more than 360,000 SMEs, accounting for 98 per cent of enterprises and employing 45 per cent of the private sector workforce in the city, according to the Commerce and Economic Development Bureau.
Danny Lau Tat-pong, honorary chairman of the Hong Kong Small and Medium Enterprises Association, said he hoped the government could help firms with cash flow problems.
“Almost 70 per cent of small and medium-sized enterprises said business was lacklustre with their working capital being drained,” Lau added.
“I have heard some of our members say they call it a win if they lose just around HK$200,000 a month.”
The judiciary issued 809 bankruptcy orders last month, a 54 per cent year on year rise compared with July 2023.
There were also 780 bankruptcy petitions in July, up from 662 in the same month last year. “If authorities don’t bail them out during this time, there will only be more and more bankruptcy cases,” Lau warned.
The government recorded a deficit of HK$120 billion in the first quarter of the current financial year between April and June, while reserves stood at HK$614.6 billion as of June, the lowest since 2012.
Chan has been exerting pressure on banks since March in a bid to ease liquidity problems faced by SMEs and to help homeowners with mortgage obligations as the city contends with weak consumption and lacklustre stock and property markets.
Nine measures have been put in place, including that banks cannot adjust credit limits if the value of collateral depreciates, and they should allow at least six months as a grace period for customers if adjusting their credit limit during an annual review.
The town hall meeting, held at Tai Po Government Primary School, was one of a string of consultation events being held in the run-up to Lee’s third policy address since he took office in 2022. His team of 20 principal officials also attended.
Ng Sing-chin, chairman of the Tuen Mun District Secondary School Heads Association, did not manage to ask questions and said responses from officials during the meeting were not detailed enough because of time constraints.
Tam Kam-lin, of the Federation of Hong Kong and Kowloon Labour Unions, asked officials about low pay retirees re-entering the workforce generally received, and urged the government to focus on local employment before considering importing more overseas workers.
Lee last month said economic development and residents’ livelihoods would be his priorities in his policy blueprint, and that he would be “more aggressive” in gauging views from more people.
