HONG KONG: People continue to crack and go broke under the strain of the global financial crisis, and figures from the Protection of Wages on Insolvency Fund show just how things have changed for many.

The fund received 4,284 applications for the first half of 2009, compared with 3,047 applications for the same period last year. The fund received more than 1,000 applications right after the Lunar New Year. The number dropped to 600 last month.

People in the catering business are getting hit the hardest, as shown by the 982 applications from that sector during the first six months of the year. Right behind and sailing into equally dire straits was the import and export sector, which recorded 676 applications. There were 437 applications from the construction industry.

The Hong Kong Federation of Restaurants and Related Trades chairman Simon Wong Ka-wo said many small restaurants have closed their business in March and April, shedding some light on the reason that 23 percent, nearly one quarter, of all distress applications came from catering.

He added that the sector has been badly hit by the financial crisis.

"Our business started improving in June, but then came the human swine flu," Wong said, adding that the drop in tourists created a severe blow to the sector.

Figures from Hong Kong Tourism Board showed that visitor arrivals to Hong Kong dropped by 15 percent in June from a year earlier, to around 1.83 million. That brought the cumulative arrivals for the first six months to 13.7 million, down 3.4 percent from a year earlier.

Hotel occupancy in June averaged 61 percent, down 20 percent from a year earlier.

"The stock market and the property market have started improving, but tourist numbers still remain low," Wong said.

The high rental cost is another factor affecting the business environment for the sector, Wong said.

The Protection of Wages on Insolvency Fund Board chairman Clement Chen Cheng-jen said in a radio program that the decline in visitors has also affected the jewellery, watch, fashion and electronic products retailers as mainland visitors contributed to a large portion of these businesses.

China Daily

(HK Edition 07/31/2009 page1)