Professor Hongbin CAI, Dean and Chair of Economics, Director of the Institute of China Economy (ICE) of HKU Business School, delivers the welcoming remarks.
The 6th HKU Quarterly Forum on Chinese Economy, hosted by HKU Business School's Institute of China Economy (ICE), in collaboration with the Tsinghua Alumni Association of Hong Kong, was held on 16 April. The Forum brought together renowned experts and industry leaders to examine the growth engines of China's economy, as well as the related policy directions and outlook under the ever-changing global landscape. Speakers shared valuable insights on the current tariff war, trade war, China's real estate economy and the challenges and opportunities facing China's macroeconomy. Held at HKU iCube, the Forum brought together a diverse audience of industry leaders, academic experts, alumni and students, with nearly 230 people in attendance.
In his welcome speech, Professor Hongbin CAI, Dean of HKU Business School, said, "The Institute of China Economy at the HKU Business School has always aimed to be an important international platform for academic exchange on the study of the Chinese economy. Today, we are pleased to partner with the Tsinghua Alumni Association of Hong Kong and to have several industry experts join us as guests at the Quarterly Forum on China Economy. In this historic moment, we will engage in targeted research and discussions on key issues surrounding the Chinese economy and policies with a spirit of in-depth analysis and openness, exploring the economic landscape of China and the world, as well as the role that Hong Kong can play within it."
Mr Chunbo LI, President of Tsinghua Alumni Association of Hong Kong, Chairman and Chief Executive Officer of CITIC Securities International, remarked during his welcome speech that the global political and economic landscape is undergoing unprecedented transformation. Hong Kong, with its unique institutional advantages and its strategic position of connecting motherland to the world, has become even more pivotal in this evolving environment. The recent "tariff war" initiated by the Trump administration is reshaping the international trade and economic order, prompting businesses across China to evaluate the situation, devise response strategies, and adjust their development plans accordingly. This forum thus provides a valuable opportunity to discuss the challenges and opportunities facing China. Tsinghua alumni from the Mainland and Hong Kong hope to collaborate with business leaders, academics, and industry professionals to contribute to the long-term stability and prosperity of China's economy with their professional and international expertise.
Professor Zhenhua MAO, Professor of Practice in Economics of HKU Business School and Member of Chief Executive's Policy Unit Expert Group, presented the keynote report titled "Global Tariff Shocks and the 'New Three Phases of Superposition': China's Current Economic Situation and Policy Outlook." He reviewed China's macroeconomic performance in the first quarter of the year, noting that economic policies have begun to show positive effects, with multiple supply and demand indicators continuing to improve. This marks a buffering period for China's economy — "New Three Phases of Superposition" characterised by price stabilisation, risk mitigation, and the emergence of new growth momentum. However, in April, the unexpected escalation of U.S. tariffs created significant economic shockwaves in China, making the first quarter a turning point for its economy. Whether China's economy can maintain stability remains uncertain. Professor Mao emphasised that while the U.S.-led tariff war may seem unreasonable, it is clearly driven by its core principle of "America First." As the trade conflict escalates, tariffs not only pose short-term challenges, affecting exports, prices, employment, consumption, and investment, but could also reduce GDP growth by approximately two percentage points. In the long term, economic "decoupling and supply chain disruptions" will have a profound impact on China's economic and industrial structure, as well as on the U.S. economy itself. To address these challenges, Professor Mao suggested that China must prepare strategically across political, economic, trade, financial, and military dimensions. He argued that China should first focus on stabilising its economy. In the short term, the focus will be on expanding domestic demand, stabilising prices, mitigating risks, and enhancing countercyclical adjustments of macroeconomic policies; in the medium to long term, we need to accelerate reforms and opening up, unleashing the potential of households and businesses to enhance economic resilience. Additionally, from a medium-to-long-term planning perspective, China should continue transitioning its economic structure from an export-driven manufacturing powerhouse to a domestic demand-driven consumer economy, enabling deeper participation in the reshaping of global trade rules.
The Forum was followed by inspiring keynote speeches by three distinguished speakers. Professor Shusong BA, Professor of Practice in Finance of HKU Business School, spoke on the topic of "Volatility Outlook in China's Real Estate Market" and highlighted recent data indicating signs of recovery in the first-hand real estate market, with tier-one and emerging tier-one cities expected to achieve stabilisation after declines. However, most cities will still face downward pressure on housing prices. Professor Ba stated, "Looking ahead, China's real estate market will generally be in a transition phase between old and new cycles and models. The negative effects of the old cycle need to be absorbed, while the positive factors of the new cycle need room to grow. According to data, China's total real estate market value accounts for over 200% of GDP, whereas in the United States, it is less than 80%. The previous model, driven by real estate expansion and debt growth, is no longer sustainable. Therefore, the goal of market development should not be to return to historical peaks, but to gradually stabilise at a new equilibrium level, allowing sufficient time for the new cycle to develop."
Professor Zhiwu CHEN, Chair Professor of Finance of HKU Business School, focused on the theme of "What Does History Tell Us about US Government Debt?" and pointed out that a country's political system plays a crucial role in assessing its debt sustainability. While the U.S. government has a high level of debt, it has not yet reached a critical point when viewed solely from the perspective of national debt levels. Professor Chen stated, "No need to panic about any U.S. government debt crisis to cause a global recession soon. As long as the Trump Administration does not mess up the U.S. governance system, its debt capacity is huge and can accommodate further expansion."
Professor Haishi LI, Assistant Professor in Economics of HKU Business School, presented on the topic of "From anti-dumping to trade war: the past, present and future of trade policies and disputes" and pointed out that with the weakening of the World Trade Organisation (WTO) framework, the WTO has been ineffective in curbing the shift towards unilateralism. Moreover, past rule-based trade policies are increasingly influenced by the personal agendas and preferences of political leaders. He stated, "In light of the current uncertainty in the trade environment, Chinese enterprises may need to explore opportunities for re-export trade to sustain exports, including utilising free trade zones, development zones, and bonded areas in other countries to mitigate the impact of tariffs.
A roundtable discussion titled "China's Current Macro, Financial and Trade-related Hot Issues" was moderated by Professor Hongbin CAI. Panellists include Mr Fang FANG, Founding Partner of Waterwood Investment Group; Ms Helen QIAO, Chief Economist for Greater China, Head of Asia Economics Research of Bank of America; Mr Xiaolong LIU, Chairman and CIO of Intewise Capital Management Limited; Mr Ting LU, Chief China Economist of Nomura and Dr Ning ZHANG, Senior China Economist of UBS Group AG. Speakers noted that amid the escalating China-U.S. trade war, China is facing a dual challenge of unstable domestic demand with a declining real estate market, and significant pressure on external demand. To enhance economic resilience, the government must strengthen efforts to stabilise the real estate and stock markets, boost domestic demand, stimulate consumption and public investment, and leverage Hong Kong's strategic position to support Chinese enterprises in expanding overseas.
