GDP in Hong Kong
Hong Kong - GDP
Growth momentum strengthens in Q4
Hong Kong’s economy ended 2016 on a solid footing as tailwinds from rising tourist arrivals and gradually improving retail sales propelled private consumption, while a pick-up in global demand boosted export growth. GDP expanded 3.1% in Q4 over the same quarter of the previous year, which was above the revised 2.0% increase in Q3 (previously reported: +1.9% year-on-year). The print beat market expectations of 1.6% growth and represented the fastest acceleration since Q2 2015. In the full year 2016, the economy grew 1.4%, below 2015’s 2.4% rise.
Private consumption logged 3.2% growth in Q4 (Q3: +1.2% yoy) as the tourism sector has started to recover and low inflation has increased real wages. Growth in government consumption steadied in Q4, although it still managed to expand a healthy 3.3% annually in Q4 mainly due to Hong Kong authorities’ fiscal support. On the downside, fixed investment decelerated in Q4 due to rising global uncertainties.
On the external side of the economy, exports of goods and services were up 4.5% in Q4 (Q3: +1.6% yoy), the largest increase in four years. The island benefited from a pick-up in global demand, particularly from China. Similarly, imports grew a hefty 5.0% in Q4 (Q3: +2.7% yoy), reflecting solid domestic demand and higher commodities prices. As a result, the external sector’s net contribution to overall economic growth rose from minus 2.1 percentage points in Q3 to minus 0.9 percentage points in Q4.
On a quarter-on-quarter basis, Hong Kong’s economy grew a seasonally-adjusted 1.2% in Q4, which was above Q3’s 0.8% increase.
Despite Q4’s positive result, a number of factors are threatening to daunt Hong Kong’s healthy growth momentum. Rising protectionism, an abrupt slowdown in China and political uncertainty in the European Union are all casting a long shadow on the island’s economy. In an attempt to shield Hong Kong’s economy against external shocks, on 22 February, Financial Secretary Paul Chan Mo-po announced a series of one-off measures, including an increase in salary tax deduction and a boost in infrastructure spending.
The government expects the economy to grow a rate of between 2.0% and 3.0% this year. FocusEconomics Consensus Forecast panelists see GDP expanding 1.7% in 2017, which is down 0.1 percentage points from the previous month’s estimate. For 2018, the panel expects the economy to increase 2.1%.
Hong Kong - GDP Data
|Economic Growth (GDP, annual variation in %)||4.8||1.7||3.1||2.7||2.4|
5 years of economic forecasts for more than 30 economic indicators.
Hong Kong GDP Chart
Source: Census and Statistics Department Hong Kong and FocusEconomics calculations.
Hong Kong Facts
|Bond Yield||1.63||-4.12 %||Mar 27|
|Exchange Rate||7.77||0.01 %||Mar 27|
|Stock Market||24,194||-0.68 %||Mar 27|
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March 3, 2017
The Nikkei Hong Kong Purchasing Managers’ Index (PMI) released by IHS Markit dipped to 49.6 in February from 49.9 in January, retreating more firmly into contractionary territory after briefly rising above the 50-point threshold that separates expansion from contraction in the business environment in December. Demand for Hong Kong’s goods and services continued to decline, both in the domestic and external markets, contributing to the PMI’s fall.
March 3, 2017
The decline in retail sales in Hong Kong lessened to 1.4% year-on-year in January, improving somewhat from December’s drop (-2.9% yoy).
February 22, 2017
Hong Kong’s economy ended 2016 on a solid footing as tailwinds from rising tourist arrivals and gradually improving retail sales propelled private consumption, while a pick-up in global demand boosted export growth.
February 21, 2017
Inflation rose slightly from December’s 1.2% to 1.3%.
February 3, 2017
The drop in retail sales in Hong Kong lessened to 2.9% year-on-year in December, recovering somewhat from the sharp decline in November (-5.4% yoy).