Hong Kong's overall business index for the third quarter of 2026 rose to 44.1, and the confidence of small and medium-sized enterprises in business has shown signs of improvement.

On July 9th, Hong Kong Productivity Council announced the "Standard Chartered Hong Kong Small and Medium Enterprise Leading Business Index" for the third quarter of 2026. The comprehensive business index for this quarter recorded 44.1, a slight increase of 0.8 from the previous quarter, reflecting a slight improvement in business confidence of Hong Kong small and medium enterprises driven by external environment improvements, but the overall attitude remains cautious. The survey for the "Standard Chartered Hong Kong Small and Medium Enterprise Leading Business Index" was conducted from May to June 2026, interviewing a total of 826 Hong Kong small and medium enterprises, with additional analysis of 20 enterprises that have expanded to other cities in the Greater Bay Area. The survey showed that among the five major sub-indices, the "Global Economy" sub-index rebounded significantly, rising by 12.2 to reach 33.1 quarterly, returning to the level of the fourth quarter of last year, indicating that small and medium enterprises have improved their views on the global economic outlook. Within the Global Economy sub-index, the largest increases were seen in "Import and Export Trade and Wholesale" (15.6) and "Professional and Commercial Services" (15.3). The performance of the other four sub-indices remained relatively stable. However, other operational indicators showed differentiation. The "Recruitment Intention" index was at 50.5, and the "Investment Intention" was at 50.0, both maintaining at neutral levels of 50 or above, indicating stable recruitment and investment activities by enterprises; however, the "Business Conditions" was only 40.5, and the "Profit Performance" was 37.8, both below the 50 level, reflecting a cautious attitude towards short-term business operations and profit prospects by small and medium enterprises. Regarding cost pressures, 64% of Hong Kong small and medium enterprises expected an increase in raw material costs this quarter, a decrease of 3 percentage points from the previous quarter but still at a relatively high level. The proportion of companies expecting an increase in employee wages dropped to 17%, a decrease of 3 percentage points from the previous quarter; and the proportion of companies planning to raise product or service prices also dropped to 19%. StanChart's Senior Economist for Greater China and North Asia, Hu Dong'an, said that the increase in the global economy was mainly due to the ceasefire in April between the US and Iran, the global oil prices falling back to pre-conflict levels, and the AI boom driving strong export performance. However, recent changes in the US-Iran situation have impacted the market, but Hu Dong'an believes that the market's overall fatigue towards US-Iran war has already set in. Even if tensions rise in the Middle East, the impact on small and medium enterprises or the overall export environment is still more optimistic than the previous quarter. The special survey conducted in this study mainly explored the current situation and related deployments of local small and medium enterprises in cross-border businesses. The results showed that 25% of the surveyed small and medium enterprises have already engaged in cross-border business, and another 11% expressed intention to expand related business. Many of these enterprises are considering introducing AI or digital technology in various business processes. However, 64% of small and medium enterprises have no plans to enter the cross-border market temporarily, citing reasons such as lack of manpower, high costs or insufficient funds, unfamiliarity with overseas markets, and perceived high risks. Director of Marketing at the Hong Kong Productivity Council, Fung Ka-po, said, "The Hong Kong Productivity Council has always provided different support to help enterprises face challenges, such as the 'Six Tips for Export', as well as professional services and support in overseas manufacturing. In addition, the Hong Kong Productivity Council also provides assistance in areas such as brand development, digital operations, and expanding into overseas markets."