Worst still to come for HK amid crisis'Financial tsunami' bigger than '97, banker saysMaria Chan, Cheung Chi-fai and Agencies in Washington and Paris
Oct 05, 2008 
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Despite the passage of the US government's US$700 billion bank bailout, Hong Kong must brace for belt-tightening amid the global "financial tsunami", the city's labour chief and a top banker said yesterday.
HSBC (SEHK: 0005, announcements, news) Asia-Pacific executive director Peter Wong Tung-shun warned the impact of the crisis would be "far more severe" than that of the 1997-98 East Asian financial crisis.
"This will affect Hong Kong and the whole world," he said. The effects would be felt for another 12 months and recovery would take "much longer" than a decade ago.
So far investors - including buyers of minibonds backed by bankrupt US bank Lehman Brothers, who scuffled with bank security staff yesterday - have been the biggest losers locally from the crisis. But both men warned its impact would grow.
Mr Wong expected Hong Kong businesses would have to control costs, but said mass layoffs were unlikely. Matthew Cheung Kin-chung, the secretary for labour and welfare, forecast jobs would go, however.
He said: "The financial tsunami will have a far-reaching impact. Enterprises may need to make manpower changes and there is a chance unemployment will rise, particularly in the finance and property sectors. Consumption will likely be hit too." .................................................
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Associated Press, Reuters, Agence France-Presse