Economy Contracts 9% In Q2

Hong Kong’s economy in the second quarter of 2020 contracted 9% over a year earlier, slightly lower than the 9.1% decrease in the first quarter.

The Census & Statistics Department announced the findings today as it released the advance estimates on Gross Domestic Product (GDP) for the second quarter.

According to those estimates, private consumption expenditure decreased 14.5% in real terms in the second quarter, while government consumption expenditure grew 9.6%.

Gross domestic fixed capital formation dropped 20.6%, compared with the decrease of 15.8% in the first quarter.

Over the same period, total goods exports declined 2.1% and goods imports also fell 6.8%.

Exports of services fell significantly by 46.6% and imports of services decreased 43.5%.

The Government said overall economic conditions remained very weak in the second quarter as the COVID-19 pandemic continued to hit global and local economic activities severely.

But the city's overall economic situation showed signs of stabilisation during the quarter, as real GDP fell marginally by 0.1% on a seasonally adjusted quarter-to-quarter comparison.

Looking ahead, the pandemic will remain a key threat to the global economic outlook, and the challenging external environment will likely constrain Hong Kong's export performance in the near term. The recent surge in COVID-19 cases has also clouded the near-term outlook for domestic economic activity.

Nonetheless, once the local epidemic is contained again and the external environment continues to improve, the Hong Kong economy hopefully will gradually recover in the rest of the year.

The revised GDP figures for the second quarter will be released on August 14.