Hong Kong will release its final GDP growth rate for Q1 2021 today. Advanced predictions show the Hong Kong economy
Hong Kong will release its final GDP growth rate for Q1 2021 today.
Advanced predictions show the Hong Kong economy jumped 7.8% so far this year. Global trade appears to be recovering, as goods imports and exports grew by 23.3% and 30.6% respectively. The larger than expected economic growth is driven mainly by exports to the US and mainland China.
Recovery, however, has been uneven across different economic sectors. Service and consumer-facing business continues to be strangled by pandemic restrictions; tourism is likewise nonexistent. While today’s increase marks the end of Hong Kong’s 11 year recession, the economy is still below pre-recession levels. The Hong Kong Legislative Council recently passed an aid package—lowering interest rates and providing consumer stipends, to increase—consumer spending.
Expect imports and exports to continue growing in the short-term as the global economy continues to rebound from the pandemic. The service economy will likely improve in the medium-term as global travel restrictions loosen and tourism rebounds. Vaccine hesitancy, however, could upend the city’s long-term prospects. As jab rates remain low due to government mistrust, international businesses will probably avoid returning, meaning GDP could lower by year’s end despite a global economic uptick.