The IMF issued a warning to Hong Kong officials today that they might need to back their banks. Nigel Chalk, the IMF’s China mission chief said that Hong Kong will need to guarantee bank deposits if the situation in Europe continues to worsen. The IMF report said that Hong Kong must be ready to provide fiscal stimulus that could include tax cuts, subsidies for the poor and rolling back restriction on property. The IMF sees Hong Kong’s growth slowing down to 4% in 2012 due to weak exports. Hong Kong avoided a recession in the third quarter. Read more