Economy grows 7.8% in Q1

May 3, 2021

Hong Kong’s economy in the first quarter of 2021 expanded 7.8% over a year earlier, ending the streak of contraction in the preceding six quarters, the Census & Statistics Department announced today.


According to the advance estimates on gross domestic product (GDP) for the first quarter released today, on a seasonally adjusted quarter-to-quarter comparison, GDP rose visibly by 5.3% in the quarter, a marked acceleration from the 0.5% increase in the preceding quarter.


Private consumption expenditure increased 1.6% in real terms in the first quarter over a year earlier, while government consumption expenditure grew 6.7%.


Gross domestic fixed capital formation rose 4.5%, compared with the increase of 3.6% in the fourth quarter last year.


Over the same period, total goods exports recorded an increase of 30.6% and goods imports grew by 23.3%.


Exports of services fell by 8.7% and imports of services decreased 14.9%.


The Government said the sharp economic rebound in the first quarter mainly reflected the very strong growth of goods exports amid the global economic recovery led by the Mainland and the US.


However, as the COVID-19 epidemic and social distancing requirements continued to weigh on certain economic segments, particularly those involving consumer-facing activities, the economic recovery was uneven and the overall economic activity was still below the pre-recession level. Tourism also remained in the doldrums.


It is thus essential for the community as a whole to spare no effort to keep the epidemic under control and to ensure the success of the COVID-19 Vaccination Programme as this will pave the way for a broad-based economic recovery and a gradual resumption of international travel, the Government noted.


Looking ahead, the global economic recovery led by the Mainland and the US should bode well for Hong Kong's goods exports in the near term, while exports of services should likewise improve, though the revival of tourism-related activities will likely be slow given the still austere pandemic situation in many places around the world.


Other risk factors such as China-US relations and geopolitical tensions also warrant attention.


Moreover, if the local epidemic remains well contained, and with the support of various government relief measures and the improving global economic conditions, business and consumer confidence can hopefully see a broader-based improvement later this year.


The revised GDP figures for the first quarter will be released on May 14.

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