Hong Kong’s GDP data points to a tough road ahead
- Clearly, Hong Kong needs to raise its game in the post-Covid environment if economic growth is to return to previous robust levels
There are more signs of recovery as public life returns to normal – long queues at restaurants; shows and events with full houses; and busy checkpoints at the border.
If not for some health-conscious citizens continuing to wear masks, Hong Kong would not seem like a city that had just emerged from a devastating pandemic. However, the rebound has yet to translate into rosy economic figures.
The reality check came when Financial Secretary Paul Chan Mo-po forewarned of a less robust quarterly growth rate ahead of the official release yesterday.
According to the advance estimates, real GDP grew by 1.5 per cent in the second quarter over a year earlier, compared with an increase of 2.9 per cent in the first quarter. On a seasonally adjusted quarter-to-quarter basis, real GDP fell by 1.3 per cent.
Writing in his blog on Sunday, Chan conceded that the road to recovery would not be a smooth one. Merchandise export, one of the three main growth engines, continued to shrink for the 14th consecutive month in June.
It dropped 13 per cent year on year in the second quarter compared with 18 per cent in the first three months. This is in line with the 7.5 per cent year-on-year drop in mainland China’s exports in May.
