YOU WILL ALREADY have seen the second quarter economic figures and I am certainly not one to quibble with the general conclusion that a negative year on year growth rate of only 0.46 per cent was an excellent result for that Sars- plagued period.
Let us instead play some games with numbers here, starting with a general misconception about how a critical component of the gross domestic product (GDP) figures is calculated.
Pardon me if this does not describe you but you probably thought at the height of the Sars scare that the big drop in visitor arrivals and the consequent drop in visitor spending would have a pronounced impact on economic growth.
At the same time you may have noticed that Hong Kong people also cut back on travel abroad during Sars. Just as well, you may have said. What they spend abroad does nothing for our economy and the fact that they are taking less money out should reduce the impact of Sars a little.
Think again. The actual way it works in the calculation of GDP figures is the exact reverse. Rather than include what visitors spend in Hong Kong, the final figures exclude it. And, rather than exclude what residents here spend abroad, the final figures include it.
It seems an upside down way of doing things but there you go. Our GDP figures are calculated on an expenditure model, which means that it measures our economy's output by what we spend rather than what we produce.
