MOSCOW, October 17 (RIA Novosti) — Hong Kong's economy could face economic repercussions in the long-term as a result of the region's ongoing pro-democracy protests, Societe Generale economist Wei Yao told CNBC.
"The short-term damage to the economy is already visible, with retail sales and tourism badly hit. [But] the social discontent and its aftermath are also likely to cast a long shadow over the city's long-term economic potential," Wei was quoted as saying by CNBC.
Protesters in Hong Kong have carried out demonstrations for three weeks now, recently sparking violent clashes between the police and demonstrators. According to CNBC, should protests continue, Hong Kong may lose favor with Beijing, which could be detrimental to the special administrative region’s economic future. Hong Kong could lose out on becoming a test ground for liberalization, much like Shanghai’s free trade zone, which could boost the region's income per capita by 7 to 12 percent by 2030, according to the media.
"There is a tail risk that mainland tourism to Hong Kong – a pillar of Hong Kong's economy – is affected more permanently, either because of perceptions among the Mainland public or changes in policy," RBS chief China economist Louis Kuijs was quoted as saying by CNBC.
Though analysts differ on the specific long-term effects protests will have on Hong Kong's economy, they agree the region's massive decrease in tourism already seen in the short-term serves as an indicator for the future. On October 2, the Chinese National Tourism Association issued a travel warning discouraging tour groups from visiting Hong Kong because of the ongoing demonstrations.
The Occupy Central with Love and Peace protests began on September 27 with demonstrators speaking out against the Chinese government's plans to control the region's 2017 election. Protesters claim Beijing has gone back on its pledge to allow universal suffrage in Hong Kong, which was promised a high degree of autonomy when it was handed back to China by Britain in 1997.
Demonstrations took a turn for the worse on Wednesday when video footage revealed six Hong Kong policemen beating a protester for several minutes. The incident is currently being investigated by Hong Kong authorities.
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