Hong Kong Q1 GDP rises 7.8% y-o-y after six quarters of contraction
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[HONG KONG] Hong Kong's economy grew in the first quarter, snapping six consecutive quarters of annual contractions as a lower coronavirus threat allowed activity to pick up with hopes for a continued recovery largely pinned on the vaccination drive.
Government advanced estimates showed on Monday the economy grew 7.8 per cent in January-March, compared with a revised decline of 2.8 per cent in the previous quarter, reflecting strong growth of exports of goods amid the global economic recovery led by the mainland and the United States, and helped by a low base comparison.
It is expected to see a broader based improvement later in the year provided the pandemic remains under control.
The trade-reliant city, which is also benefitting from mainland China's recovery, had been facing its longest recession on record, due to prolonged social unrest in 2019, followed by the pandemic.
On a quarterly basis, the economy grew a seasonally adjusted 5.3 per cent for the January-March period, from a revised growth of 0.5 per cent in the previous quarter.
"Looking ahead, the global economic recovery led by the mainland and the US should bode well for Hong Kong's exports of goods in the near term," a government spokesperson said in a statement.
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"Exports of services should likewise improve, though the revival of tourism-related activities will likely be slow in view of the still austere pandemic situation in many places around the world," the spokesperson added.
The government had earlier forecasted its real GDP growth of 3.5-5.5 per cent for 2021. The revised forecast will be released on May 14.
Hong Kong, which has avoided the ravaging outbreaks seen in other developed cities, loosened some of its coronavirus restrictions last month, though slow progress in the vaccination programme remains a concern.
The city's seasonally adjusted unemployment rate slipped to 6.8 per cent in the January-March period, compared with 7.2 per cent in the December-February period.
Retail sales jumped 30 per cent in February due largely to distortions from the timing of the Chinese New Year.
REUTERS
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