Hundreds of restaurants in Hong Kong could be shut down within weeks by the atypical pneumonia outbreak as diners opt to stay at home and takings fall off sharply, industry sources said yesterday.

Catering industry representatives said restaurants that were already suffering from the prolonged economic downturn could be dealt a fatal blow by the outbreak.

Legislator Tommy Cheung Yu-yan, who represents the catering industry, said restaurant takings had fallen about 50 per cent in the past few weeks - one of the industry's biggest declines over such a short period in recent years.