Inbound tourism, local demand fuel Hong Kong’s Q1 economic rebound

HONG KONG (Xinhua/APP): The Hong Kong economy improved visibly in the first quarter of 2023, led by the strong recovery of inbound tourism and local demand, official data showed Friday.

Real gross domestic product (GDP) resumed year-on-year growth of 2.7 percent and surged by 5.3 percent on a seasonally adjusted quarter-to-quarter comparison, according to the first quarter economic report released by the Hong Kong Special Administrative Region (HKSAR) government.

Local private consumption expenditure surged by 13 percent year-on-year in real terms in the first quarter, as consumption sentiment improved sharply along with the adjustment of anti-epidemic measures in both Hong Kong and the mainland. Overall investment expenditure reverted to 5.8 percent growth amid an improved economic outlook.

The unemployment and underemployment situation continued to improve in the first quarter alongside the economic recovery. The seasonally adjusted unemployment rate declined further from 3.5 percent in the preceding quarter to 3.1 percent in the first quarter, and the underemployment rate went down from 1.5 percent to 1.2 percent, government data showed.

In terms of the stock market, the Hang Seng Index closed the quarter at 20,400 points, 3.1 percent higher than end-2022. The residential property market revived, as market sentiment improved along with the local economic recovery.

Looking forward, inbound tourism and local demand will remain the major drivers of economic growth this year.

Taking into account the actual outturn in the first quarter and the factors mentioned above, the HKSAR government maintained its real GDP growth forecast for this year at 3.5 percent to 5.5 percent.