Confidence in Hong Kong's economy has weakened among professionals in finance and accounting amid growing worries about the city's unstable political environment and increased competition from other Asian economies, according to a survey by CPA Australia.

The survey of 454 members of Australia's largest accounting organization in Hong Kong and on the mainland showed that 40 percent of the respondents were "negative" on the SAR's economy next year - the highest level since 2012.

More than half of the interviewees projected growth of less than 1.9 percent for this year, and only 19 percent of those surveyed said they believed that growth in 2015 will exceed 1.9 percent.

Some 61 percent of the respondents put "political environment" at the top of factors that are "hurting" the economy, and 48 percent cited mounting competition from other Asian economies as the major threat.

Standard Chartered on Monday cut its 2014 Hong Kong GDP estimate from 2.5 to 2.2 percent, matching the SAR government's forecast.

But the bank projected a 3-percent growth for 2015, saying that resilient domestic consumption and stronger global demand are likely to support Hong Kong's economic recovery.

Ronald Yam Tak-fai, divisional president of CPA Australia Greater China, said that despite political uncertainties and potential threats, the foundation of the Hong Kong economy that underscores a successful and prospectus future has remained intact. "History shows us that Hong Kong is resilient and the economy can rebound quickly and strongly after a downturn," he said.

In the poll, 50 percent of the respondents cited the mainland's preferential treatment of Hong Kong as the major factor for growth, while 48 percent betted on an improvement in the mainland's economy, and 47 percent ranked economic recovery in the US as the most effective drive.

Among Hong Kong respondents, 61 percent said they believed that mainland enterprises will continue to choose Hong Kong as the place to raise new capital through initial public offerings (IPO), but only 38 percent of mainland respondents concurred.

"Although nearly half of the respondents said they believed Hong Kong is losing its leadership role as an IPO hub, Hong Kong will remain an important source of capital for mainland enterprises," said Patrick Yeung Kai-cheung, chairman and founder of Asian Capital Holdings.

He noted that an unstable political environment may cause some mainland enterprises to put their IPO plans on hold, but said they will restart those plans when the situation returns to normal.

To restore confidence and remain competitive, Hong Kong needs to embrace new opportunities arising from economic development on the Chinese mainland and in other Asian economies, Yeung said.

"We don't see any reason for Hong Kong's economy failing to grow strongly again in future as long as we succeed in increasing our investment in human capital and improving our cost structure," he added.

amandahua@chinadailyhk.com

(HK Edition 12/10/2014 page8)