Hong Kong recorded a $10.4 billion surplus in its Balance of Payment account (at 3.5% of GDP) in the first quarter of the year, after a deficit of $11.6 billion in the fourth quarter of 2002.

Of the major BoP components, there was a current account surplus of $35.9 billion (at 12.1% of GDP) in the first quarter, smaller than that of $45.3 billion (at 13.7% of GDP) in the fourth quarter of 2002.

At the same time, a net outflow of financial non-reserve assets amounting to $26 billion (at 8.8% of GDP) was recorded in the first quarter, smaller than that of $65.5 billion (at 19.8% of GDP) in the previous quarter.

Comparing the first quarter with the previous one, the visible trade deficit increased from $5.6 billion to $16 billion, while the invisible trade surplus decreased from $52.1 billion to $40.1 billion.

Concurrently, net inflow of external factor income increased from $2.4 billion to $15.9 billion, while net outflow of current transfers increased from $3.6 billion to $4.1 billion.

There was a net direct investment inflow of $3 billion in the first quarter, as against a net direct investment outflow of $3.4 billion in the fourth quarter of 2002.

In the first quarter, reserve assets increased by $10.4 billion, as against a decrease of $11.6 billion in the fourth quarter of 2002.