Two women take a selfie along Victoria Harbour in Tsim Sha Tsui, Hong Kong on Jan 2, 2023. (PHOTO / CHINADAILYHK.COM)
HONG KONG –Hong Kong's economy contracted by 4.2 percent in the fourth quarter of 2022 from a year earlier mainly due to continued weak performance in external trade during that period, government data showed on Wednesday.
According to advance estimates, gross domestic product decreased by 4.2 percent in real terms in the fourth quarter, compared with the decrease of 4.6 percent in the third quarter, according to the Census and Statistics Department.
For 2022 as a whole, GDP decreased by 3.5 percent in real terms from 2021, it added.
A government spokesman said the Hong Kong economy is expected to show a recovery in 2023. While softer growth of the advanced economies will continue to pose challenges to the SAR's exports of goods, an expected faster growth of the mainland economy and the relaxation of cross-boundary truck movement restrictions should provide some support
On a seasonally adjusted quarter-to-quarter comparison basis, the GDP remained virtually unchanged in real terms in the fourth quarter of 2022 when compared with the third quarter.
Private consumption expenditure increased by 1.7 percent in the fourth quarter over a year earlier, government consumption expenditure grew by 9.1 percent, and gross domestic fixed capital formation decreased by 11.2 percent.
According to Hong Kong Special Administrative Region government spokesman, the fall in goods exports widened further, but private consumption resumed growth.
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“Total exports of goods plunged amid the sharp deterioration in the external environment and disruptions to cross-boundary truck movements. Domestic demand slackened, dragged initially by the fifth wave of local epidemic and subsequently by tightened financial conditions,” the spokesman said in a statement.
“Nonetheless, private consumption has seen improvement since the second quarter and particularly towards the end of the year, in tandem with the stabilized local epidemic situation and thus progressive relaxation of social distancing measures, improved labor market conditions and disbursement of consumption vouchers,” he added.
Looking ahead, the spokesman said the Hong Kong economy is expected to recover in 2023. While softer growth among the advanced economies will continue to pose challenges to the SAR's exports of goods, an expected faster growth of the Chinese mainland economy and the relaxation of cross-boundary truck movement restrictions should provide some support.
He said an expected strong rebound of inbound tourism following the removal of quarantine arrangements for visitors and resumption of normal travel between the SAR and the mainland should underpin a recovery of exports of services.
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“Domestically, an improved economic outlook in tandem with the return of economic activities from the epidemic to normalcy should render a boost to private consumption in 2023, with the strong labor market providing further support. Fixed asset investment will likewise benefit,” the spokesman added.