The Hong Kong economy is set to grow 2.5 per cent this year and 5.3 per cent next year driven by mainland government policies aimed at stimulating business, according to a forecast commissioned by the Better Hong Kong Foundation.
'The Sars outbreak in the spring of 2003 can be treated as a random shock to the economy,' said Francis Lui Ting-ming, director of the Centre for Economic Development at Hong Kong University of Science and Technology, which carried out the forecasts.
'In recent months, Hong Kong has faced another type of shock, but this time it is in the opposite direction,' Professor Lui said.
'The new policies of the Chinese government towards Hong Kong, including Cepa and the increase in the number of tourists allowed to come to Hong Kong, must have had some positive effects on the economy.'
The foundation expects gross domestic product to grow 2 per cent in the third quarter and 3.8 per cent in the fourth quarter. The government will release third-quarter data at the end of November.
In addition to its benchmark forecast, the foundation has released an optimistic forecast, which includes data from the stock market, which has hit a two-year high. Under the optimistic forecast, Hong Kong's gross domestic product - a measure of all goods and services produced - will expand 3.3 per cent this year and 5.8 per cent next year.
