SIMIC

"The revision takes into account the latest HKTDC Export Index survey, which indicated that 82 per cent of the 500 exporters surveyed forecast their total sales will drop 10 per cent or more year on year," said HKTDC research chief Nicholas Kwan.

"The spread of the Covid-19 pandemic (64.6 per cent), weak global demand (19.5 per cent), and the trade tensions between mainland China and the United States (10.8 per cent) are seen as the biggest threats."

More than 97 per cent of the respondents have experienced adverse consequences to their business due to Covid-19. Factors include buyers purchasing less, cancelled orders, delays in delivery, and logistical disruptions.

In response to the pandemic, 67.6 per cent of respondents implemented remote working while others transitioned to develop online sales. Despite the negativity regarding Covid-19, the pandemic has encouraged a new sense of creativity and sustainability amid the crisis.

"Some businesses - including e-commerce marketplaces, pharmaceutical and healthcare companies, logistics solution providers, video-conferencing solution providers, and entertainment streaming and online gaming platforms - are likely to thrive in this 'new normal'", said HKTDC economist Louis Chan.

Mr Chan predicted accelerated automation and the advancement of artificial intelligence technology as the global economy heads toward automation and digitisation.

Other innovations include contactless solutions and new digital channels that would greatly help traditional commercial operations.

Meanwhile, the HKTDC Export Index rose 2.2 points to 18.2 in the second quarter of 2020.

"This may indicate that the negative sentiment is now plateauing, yet the reading is still well below the 50-point watershed, indicating that Hong Kong's export performance is not likely to improve dramatically in the short term," said HKTDC economist Alice Tsang.