Innovative Business Leaders Talk Survival Strategies in the Current Economic Climate

April 27, 2020, HK: Due to the rapid spread of the coronavirus, the first webinar organized by China Daily, themed “Economic Impact of an Epidemic: A New Approach to Doing Business” was held today, with the aim of helping businesses gain new insight and opportunities in this challenging environment. Some 200 business leaders from across the region attended the online event.

Enterprises covering a wide range of sectors are struggling as the pandemic continued to ravage Hong Kong’s economy. The city’s unemployment rate in the first quarter of 2020 hit a nine-year high of 4.2 percent, while the number of people who were underemployed surged to 2.1 percent – the highest in nearly a decade.

The webinar was divided into two parts. Prof. Edward Chen Kwan-yiu, Chairman, HKU School of Professional and Continuing Education, talked about “Economic Outlook for 2020” in the first part, analyzing the current economic development trends.

Prof. Chen expected the recession caused by the COVID-19 pandemic will last for 8-10 quarters and the recovery will be in the second quarter of 2022. His assumption is that some kind of vaccine will be developed and put in place by the second quarter to 2021. And if that is the case, the economy usually will be able to take a V shape recovery and will be back to the original level by the second or third quarter of 2022.

He called the economic crisis this time a grand recession because the recession this time not only causes increasing unemployment rate and declining production, but more importantly, becomes a historical turning point in terms of geo-economics since the whole geo-economic game will be different after the pandemic.

While the full economic consequences are still unclear, technologies have provided innovative solutions in tackling the challenging business environment.

In line with the social distancing regulations in place, employees have been working, and children learning from home, boosting the popularity of video-conferencing platforms. In January and February, San Jose, California-based Zoom Video Communications registered more than 2.2 million new monthly users. In March, the number of the US company’s daily users skyrocketed nearly 380 percent from the previous year. Since the beginning of this year, the share price of Zoom Video Communications has more than doubled, giving the company a market valuation of about US$42 billion.

The second part of the webinar featured three prominent speakers - Mr. Tony Tsang, Chief Executive Officer, DYXnet Group; Ms. Norma Chu, Founder & CEO, DayDayCook; and Mr. Joe Ngai, Senior Partner and Managing Partner, McKinsey Greater China - who shared their insights and survival strategies in the current economic climate.

Mr. Tsang said compared with SARS, the coronavirus pandemic has lasted much longer, has spread wider and has left a greater impact on human society. However, it has actually given us a very good time to sit down, rethink and rewind a little bit on how we do business. There might be another kind of events like this (in future), so we have to get ourselves prepared.

He said we are ready in terms of infrastructure, network and technology. We need to grasp the chance this time to utilize technology and try something new that can benefit our business as well as our customers and suppliers in a long term.

Ms. Chu said online business is actually benefiting from the current situation but the operation of offline business has become more difficult. For her company, it is important to operate cost-effectively. We need to trim off some retail staff under this difficult economic climate. We have to remain very cautious and sensitive. But at the same time, we can’t limit ourselves. All of us have to be very creative during this period.

As an entrepreneur, she said she has to believe “we are going to come out of the crisis stronger”, hoping for a recovery in the second half of next year. “We’re going to be more efficient, nimbler and more resilient as a society, as a whole.

Mr. Ngai said under the COVID-19 pandemic, the business start to rethink about risk management. While startups are thinking about how to grasp new opportunities while big corporates are thinking about if they are agile enough to cope with the challenges and risks along with the pandemic.

He expressed his concerns that the “weak and vulnerable” business won't be able to survive the pandemic, which will make the thorny issue of inequality even worse.

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The China Daily Asia Leadership Roundtable is a by-invitation network of movers and shakers in Asia, providing platforms for focused dialogue, issue investigation and possible collective action on strategic issues relating to Asia’s economic, business and social development. Our aim is to enhance communication and increase mutual understanding between China, Asian and Western countries. Roundtable events are held in major cities across Asia.