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HK warns of slower growth due to democracy protests
[HONG KONG] Hong Kong warned on Friday that "encouraging" growth in the third quarter may be dampened in the next due to pro-democracy protests which have paralysed parts of the city for over a month.
Gross domestic product grew 2.7 per cent in the three months to September 30 year-on-year, up from 1.8 per cent growth in the previous quarter, a government statement said.
But the government set its forecast for annual growth at 2.2 per cent, at the lower end of the two-to-three per cent range announced in August.
"Looking ahead, the rather encouraging developments in the third quarter may not be able to extend into the fourth quarter, in light of disruptions to economic activities due to the Occupy movement since late September," government economist Helen Chan said in the statement.
"At this juncture, forecasting economic growth is subject to unusually large uncertainty, with the outlook hinging... on how the Occupy movement will impact on economic sentiment and domestic demand." Protesters have been staging mass sit-ins on three major Hong Kong thoroughfares since September 28, demanding free leadership elections for the semi-autonomous Chinese city in 2017.
China's communist authorities insist that candidates for the city's top post must be vetted by a loyalist committee, a decision critics say is designed to ensure the election of a pro-Beijing stooge.
Hong Kong officials have warned that prolonged protests will threaten the city's reputation as one of the world's premier financial hubs.
Exports of goods for the quarter rose 1.3 per cent year-on-year, with exports to advanced markets, such as the United States, European Union and Japan, remaining weak. Exports to Asia, however, "picked up visibly", the statement said.
Domestic demand saw continued growth with private consumption up 3.2 per cent year-on-year for the quarter.
But the government also said there were still uncertainties in the external environment, citing "uneven recovery in the advanced economies".
"The pace of global economic expansion is at best moderate in the period ahead," it said, adding that the mainland Chinese economy should continue to sustain steady growth.