Hong Kong’s economy grew by 2.7 percent in the first quarter of 2024, according to advanced gross domestic product (GDP) estimates from the Census and Statistics Department. Despite ongoing challenges, such as geopolitical tensions and tight financial conditions, Hong Kong’s economy showed resilience, driven by a combination of export growth and domestic consumption. According to the estimates, Hong Kong’s GDP saw a modest increase from 4.3 percent during Q4 of 2023. On a seasonally adjusted quarter-to-quarter basis, Hong Kong’s economy grew 2.3 percent in Q1 of 2024 compared to Q4 of 2023.
Consumption expenditure rises
Private consumption expenditure increased by 1 percent in Q1 2024 compared to Q1 2023, following an increase of 3.5 percent in the fourth quarter of 2023. Meanwhile, government consumption expenditure declined by 3 percent compared with the decrease of 5.2 percent in Q4 of 2023.
Domestically, private consumption expenditure rose mildly as household income continued to increase, further supporting Hong Kong’s economy. Moreover, the government’s various initiatives boosted sentiment, further contributing to that growth. The department also noted that overall investment expenditure increased slightly alongside the economic expansion.
In addition, gross domestic fixed capital formation increased by a moderate 0.3 percent following a 17.5 percent surge in Q4 of 2023.
Read: OECD upgrades global economic growth forecasts to 3.1 percent in 2024
Trade supports growth
One of the major contributors to the growth of Hong Kong’s economy in Q1 is the 6.7 percent increase in exports due to an increase in external demand, following a 2.8 percent increase in Q4 of 2023. Hong Kong’s imports also witnessed a 3.2 percent increase following a 3.8 percent increase in Q4 of 2023.
Notably, exports of services increased by 8.1 percent in Q1 following a 21.2 percent surge in Q4 of 2023. The department attributes the surge in exports of services to the notable growth of tourism in Hong Kong. Meanwhile, import services saw a 17.6 percent decline after they surged 26.7 percent in Q4 of 2023. Looking ahead, the department states that exports of services will continue to grow as inbound tourism and handling capacity recovers. Moreover, Hong Kong expects a surge in tourism due to the government’s efforts to promote a mega event economy.
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