Hong Kong GDP growth disappoints in 2023 on slow recovery
HONG Kong’s economy grew at a slower-than-expected pace last year, underscoring the challenges facing the city’s post-pandemic recovery as China’s slowdown and higher interest rates abroad drag on growth.
Gross domestic product expanded 3.2 per cent in 2023, according to advanced estimates announced by the Census and Statistics Department on Wednesday (Jan 31). That compared with economists’ forecast of 3.4 per cent growth.
The number reflects a disappointing economic period since the Asian financial hub reopened after years of self-imposed Covid isolation.
The government earlier last year predicted that the economy would grow within a range of 4 to 5 per cent, but revised down its projection after an initial surge in tourism and consumption fizzled out.
GDP rose 4.3 per cent in the October-to-December quarter from a year earlier, advanced figures showed. The rise was worse than economists’ estimate of a 4.7 per cent expansion.
The 2023 figure matched the government’s November forecast, and was boosted by a low base of comparison in 2022, when the economy shrank 3.7 per cent.
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“Looking ahead, the difficult external environment will continue to pose pressures on Hong Kong’s exports of goods in 2024,” a government spokesperson said in a statement accompanying the release.
“The situation may stabilise later in the year if advanced economies cut interest rates as expected.”
Hong Kong is struggling to regain lost growth after its economy contracted in all except one year from 2019 to 2022.
SEE ALSO
The city ended its last Covid curbs in March, but the boom that followed quickly ran out of steam.
Visitor numbers still trail pandemic levels, with travellers from mainland China about one-third lower than what they were before the city adopted strict quarantine measures.
Elevated US interest rates have kept borrowing costs in the territory high as the local currency is pegged to the US dollar, further weighing on consumption and investment. BLOOMBERG
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