Hong Kong Q3 GDP up by 1.8% year-on-year, growth should continue

HONG KONG: The government said this week that Hong Kong's economy expanded by 1.8 percent in the third quarter compared to the previous year.

It added that the economy should continue to grow for the remainder of the year, although at a forecast 2024 rate of 2.5 percent, revised from 2.5 percent to 3.5 percent range.

Hong Kong's economy grew by 3.2 percent in the second quarter and 2.8 percent in the first quarter of 2024. However, challenges in the global economic environment have impacted recent performance.

"While the external environment has turned more challenging recently, the Hong Kong economy is expected to maintain its growth momentum for the remainder of the year," said government economist Adolph Leung in a statement.

On a seasonally adjusted basis, the economy contracted by 1.1 percent in the third quarter (July-September), following a 0.3 percent increase in the second quarter (April-June) and 2.5 percent growth in the first quarter (January-March).

Considering economic trends in the first three quarters and the latest global and local developments, the government has revised its full-year real GDP growth forecast for 2024 to 2.5 percent, down from the previous estimate of 2.5 percent to 3.5 percent provided in August.

Leung also announced a downward revision of inflation forecasts for 2024. The underlying consumer price inflation rate is now projected at 1.1 percent, and the headline rate at 1.7 percent, compared to the previous ranges of 1.3 percent to 1.9 percent.

Despite a strong recovery in tourism, with an estimated 46 million visitors expected this year, consumer spending and retail activity remain weak. Challenges such as declining stock listings and continued capital outflows further weigh on the economy.

In his third annual policy address last month, Chief Executive John Lee emphasized the need to reform and rejuvenate Hong Kong's economy and financial markets. He outlined plans to explore new growth opportunities to bolster development and drive economic recovery.