Photo shows a view by Victoria Harbor in Hong Kong, south China, on June 11, 2020. (LI GANG / XINHUA)
HONG KONG – Hong Kong’s economy contracted 4.5 percent in the third quarter of 2022 compared from a year earlier, the Census and Statistics Department said Monday.
According to the advance estimates, real GDP fell by 4.5 percent in the third quarter from a year earlier, after decreasing by 1.3 percent in the previous quarter. On a seasonally adjusted quarter-to-quarter basis, real GDP fell by 2.6 percent, having increased by 1.0 percent in the preceding quarter.
An HKSAR government spokesman said that the territory's economy showed a widened year-on-year contraction in the third quarter of 2022, mainly due to the weak performance in external demand during the quarter
An HKSAR government spokesman said that the territory's economy showed a widened year-on-year contraction in the third quarter of 2022, mainly due to the weak performance in external demand during the quarter.
Analyzed by major GDP component, private consumption expenditure remained virtually unchanged in real terms in the third quarter while government consumption expenditure grew by 4.3 percent.
Gross domestic fixed capital formation decreased by 14.3 percent, deteriorating from the 2.1 percent decrease in the second quarter.
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Over the same period, total goods exports saw a decline of 15.5 percent while goods imports decreased by 16.0 percent. Also, exports of services fell by 3.5 percent while imports of services decreased by 4.0 percent.
An HKSAR government spokesman said the worsened external environment and continued disruptions to cross-boundary land cargo flows dealt a serious blow to Hong Kong's exports.
Tightened financial conditions resulting from the aggressive interest rate hikes by the major central banks weighed heavily on domestic demand, though improved labor market conditions and the disbursement of consumption vouchers in August rendered support to private consumption.
Looking ahead, the markedly deteriorating external environment will continue to pose immense pressure on Hong Kong's export performance in the remainder of the year, the spokesman said.
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Elevated inflation and aggressive monetary policy tightening in major advanced economies will dampen global demand further. Heightened geopolitical tensions and the development of the pandemic will also add downside risks, he said.
Nonetheless, the recent relaxation of quarantine and testing arrangements for inbound travelers should help exports of services, he added.
The spokesman said that while the generally stable epidemic situation, improved labor market conditions and the Consumption Voucher Scheme will continue to support consumption demand, tightened financial conditions and the consequential weak asset prices will increasingly offset the positive effects. Rising borrowing costs will further dampen fixed asset investment.
The revised figures on GDP and more detailed statistics for the third quarter of 2022, as well as the revised GDP forecast for 2022, will be released on November 11, 2022, the government added.
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