Advance estimates on Gross Domestic Product for second quarter of 2022
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According to the advance estimates, GDP decreased by 1.4% in real terms in the second quarter of 2022 from a year earlier, compared with the decrease of 3.9% in the first quarter. The decline of GDP was mainly attributable to the weak performance in external trade during the quarter.
Analysed by major GDP component, private consumption expenditure remained virtually unchanged in real terms in the second quarter of 2022 over a year earlier, compared with the decrease of 5.8% in the first quarter.
Government consumption expenditure measured in national accounts terms grew by 13.0% in real terms in the second quarter of 2022 over a year earlier, after the increase of 6.7% in the first quarter.
Gross domestic fixed capital formation decreased by 3.0% in real terms in the second quarter of 2022 from a year earlier, compared with the decrease of 7.8% in the first quarter.
Over the same period, total exports of goods measured in national accounts terms recorded a decline of 8.6% in real terms from a year earlier, deteriorating from the 4.5% decrease in the first quarter. Imports of goods measured in national accounts terms fell by 6.2% in real terms in the second quarter of 2022, after the decrease of 5.9% in the first quarter.
Exports of services rose by 1.8% in real terms in the second quarter of 2022 over a year earlier, as against the decrease of 2.9% in the first quarter. Imports of services decreased by 0.7% in real terms in the second quarter of 2022, compared with the 3.8% decrease in the first quarter.
On a seasonally adjusted quarter-to-quarter comparison basis, GDP increased by 0.9% in real terms in the second quarter of 2022 when compared with the first quarter.
Commentary
A Government spokesman said that the Hong Kong economy improved in the second quarter, but the extent of improvement was smaller than expected. As the local epidemic situation generally improved and the social distancing measures were relaxed in tandem, and aided by the Government's various support measures, there was some revival in domestic activities, but the recent increase in the number of COVID-19 cases and tightened financial conditions have constrained the momentum in the latter part of the quarter. Externally, weakened global demand and continued disruptions to cross-boundary land cargo flows between the Mainland and Hong Kong weighed heavily on Hong Kong's exports. According to the advance estimates, real GDP decreased at a moderated pace of 1.4% in the second quarter of 2022 from a year earlier, after contracting by 3.9% in the previous quarter. On a seasonally adjusted quarter-to-quarter basis, real GDP rebounded by 0.9%, having declined by 2.9% in the preceding quarter.
Analysed by major expenditure component, private consumption expenditure was virtually unchanged from a year earlier, while overall investment expenditure saw a narrowed decline. Total exports of goods showed a widened fall but exports of services reverted to a mild increase.
Looking ahead, the worsening global economic prospects will continue to weigh on Hong Kong's export performance in the remainder of the year. Elevated inflation in the advanced economies amid supply-side disruptions and persistent tension in Ukraine, and the stepping up of monetary policy tightening by many major central banks in response are expected to dampen economic growth significantly. While the Mainland economy should revive further, it may not be able to fully offset the deterioration in the advanced economies. Nonetheless, if cross-boundary land transportation between the Mainland and Hong Kong continues to improve, our external trade may get some relief.
Domestically, economic activities are likely to show further revival in the rest of the year, but the extent will depend on how the local epidemic evolves and how the tighter financial conditions affect consumer's spending power and sentiment. The Consumption Voucher Scheme and other support measures rolled out by the Government should continue to support demand. It remains vital for the community to work in unison with the Government to keep the epidemic under control.
The revised figures on GDP and more detailed statistics for the second quarter of 2022, as well as the revised GDP forecast for 2022, will be released on August 12, 2022.
Further information
The year-on-year percentage changes of GDP and selected major expenditure components in real terms from the second quarter of 2021 to the second quarter of 2022 are shown in Table 1.
When more data become available, the C&SD will compile revised figures on GDP. The revised figures on GDP and more detailed statistics for the second quarter of 2022 will be released at the C&SD website (www.censtatd.gov.hk/en/scode250.html) and the Gross Domestic Product (Quarterly) Report (www.censtatd.gov.hk/en/EIndexbySubject.html?pcode=B1030001&scode=250) on August 12, 2022.
For enquiries about statistics on GDP by expenditure component, please contact the National Income Branch (1) of the C&SD (Tel: 2582 5077 or email: gdp-e@censtatd.gov.hk).
Ends/Monday, August 1, 2022
Issued at HKT 16:30
Issued at HKT 16:30
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