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Statistics on Hong Kong's Gross National Product (GNP) and External Factor Income Flows (EFIF) for the third quarter of 2008 are released today (December 15) by the Census and Statistics Department.
In the third quarter of 2008, Hong Kong's GNP increased by 8.3% over a year earlier to $454.0 billion at current market prices. The Gross Domestic Product (GDP), estimated at $429.7 billion at current market prices in the same quarter, recorded a 3.8% increase during the period. Compared with GDP, the value of GNP was larger by $24.3 billion in the third quarter of 2008, representing a net external factor income inflow of the same amount, and equivalent to 5.6% of GDP in that quarter.
After netting out the effect of price changes, Hong Kong's GNP increased by 6.0% in real terms in the third quarter of 2008 over a year earlier. This was higher than the corresponding increase of 1.7% recorded for GDP in the same quarter.
Total factor income inflow into Hong Kong, estimated at $235.2 billion in the third quarter of 2008 and equivalent to 54.7% of GDP in that quarter, increased slightly by 3.3% over a year earlier. Meanwhile, total factor income outflow, estimated at $210.9 billion in the third quarter of 2008 and equivalent to 49.1% of GDP of the same period, recorded a decrease of 5.0% over a year earlier. Taking the inflow and outflow together, a net external factor income inflow of $24.3 billion was recorded in the third quarter of 2008.
Within total factor income inflow, Direct Investment Income (DII) rose by 18.0% over a year earlier, mainly due to the increase in earnings of some prominent local enterprises from investment abroad. Portfolio Investment Income (PII), however, recorded a drop of 14.5%, mainly attributable to the decrease in interest income received from holdings of non-resident debt securities and the decrease in dividend income received from holdings of some non-resident listed companies by resident investors. Other Investment Income (OII) also recorded a decrease of 15.7%, mainly due to the decrease in the interest rates of the overseas banking sector.
Within total factor income outflow, DII decreased by 5.9% over a year earlier, largely attributable to the decrease in earnings of some prominent multinational enterprises from investment in Hong Kong. PII increased by 22.2%, mainly due to the increase in dividend income received from holdings of resident publicly listed companies by non-resident investors. OII decreased by 15.3%, mainly due to the decrease in the interest rates of the local banking sector.
Analysed by country/territory, the mainland of China (the Mainland) continued to be the largest source of Hong Kong's external factor income inflow in the third quarter of 2008, accounting for 33.9%. This was followed by the British Virgin Islands (BVI), with a share of 24.1%, reflecting continued investment income inflow from this tax haven economy where Hong Kong companies had set up a considerable number of holding companies. Other major source countries/territories were the United States of America and the United Kingdom, at 6.7% and 6.1% respectively.
The Mainland and the BVI were also the most important destinations for Hong Kong's external factor income outflow in the third quarter of 2008, accounting for 27.3% and 22.3% respectively. Other major destination countries/territories included the United States of America, at 9.4%, and the Netherlands, at 8.6%.
Further Information
GDP and GNP are closely related measures of economic performance. GDP is the total value of production of all resident producing units within the territory. GNP denotes the total income earned by residents of a particular territory, regardless of the place in which the economic activities generating the income are undertaken. In other words, GNP is obtained by adding to GDP factor income earned by residents from outside the territory and deducting factor income earned by non-residents within the territory.
The above EFIF figures are compiled based on data obtained from the Survey of External Claims, Liabilities and Income, supplemented by data from other sources.
Figures of GNP and EFIF from the fourth quarter of 2006 to the third quarter of 2008 analysed by income component are presented in Table A, while the country/territory breakdowns of external factor income inflows and external factor income outflows for the same period are presented in Tables B(1) and B(2) respectively.
Statistics on GNP and EFIF for 2008 are preliminary figures. They are subject to revision when more data become available. In light of the latest information available, annual and quarterly figures on GNP and EFIF for 2007 have been revised.
Enquiries about GNP and EFIF statistics may be directed to the Balance of Payments Branch (2) of the Census and Statistics Department at 2116 5102.
Ends/Monday, December 15, 2008
Issued at HKT 16:31
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