2012.06.07 10:46:15 MARKET TALK: HK Can Handle A Potential Economic Downturn - HSBC

0846 GMT [Dow Jones] Hong Kong can manage any possible economic downturn, despite lingering concerns over the euro-zone debt crisis, as the city is structurally-stronger and less-exposed to the West than in 2008-2009, says HSBC Greater China economist Donna Kwok; she adds, a recession should be avoided, provided China has a soft landing. Kwok says Hong Kong has shrunk its trade and financial exposure to the West since 2008, increasing its ability to weather a downturn; besides, China can underpin the city's ability to handle a collapse in global trade triggered by the euro-zone crisis. But a potential asset price collapse in the biggest uncertainty, she says; "the key risk is if financial turbulence sets off further falls in asset market prices, undermining domestic demand." (chester.yung@dowjones.com) Contact us in Singapore. 65 64154 140; MarketTalk@dowjones.com (END) Dow Jones Newswires June 07, 2012 04:46 ET (08:46 GMT)