Hong Kong's primary economic engines – property, finance and international trade – are sputtering. The territory's economy tipped into recession in the third quarter of last year.

“Both external trade and domestic demand are expected to remain subdued,” John Tsang said in his annual budget address. “I forecast a decrease in GDP by 2 to 3 per cent for 2009, the first negative growth for a whole year since the Asian financial crisis in 1998.”

According to Mr Tsang, exports – primarily “re- exports” of China-made goods flowing through Hong Kong's port – grew an anaemic 2 per cent in real terms last year. The territory's entrepreneurs are the largest investors in southern China's manufacturing sector, which has been badly hit by slumping consumption in the US and Europe. Exports from neighbouring Guangdong province, which accounts for one-third of China's total, fell 23.6 per cent in January to US$24.2bn (€19bn, ￡17bn).