Hong Kong economy warms up
( 2003-07-31 08:23) (Xinhua)
Hong Kong's economy is showing signs of overall recovery with major economic indicators better than expected.
Encouraged by Hong Kong Special Administrative Region government's HK$11.8 billion (US$1.51 billion) economic relief package and the signing of the Chinese mainland/Hong Kong Closer Economic Partnership Arrangement (CEPA), Hong Kong's exports, described as the engine of its economy, took a jump in growth.
In June, Hong Kong's export (including re-export) volume reached HK$142.3 billion (US$18.24 billion), up 14 per cent over those in same period last year.
Tourism, another pillar of Hong Kong's economy, resumed quickly after being hit hard by SARS (the severe acute respiratory syndrome).
Statistics indicated that arrivals in Hong Kong in June reached 730,000, up 70 per cent from those in May. The hotel occupancy rate also picked up from 18 per cent in May to 70 per cent at present.
Hong Kong's catering business is also regaining strength. With a decrease in rents and salaries paid to employees, its costs have been reduced by 30 per cent compared with those of the pre-SARS period. It is estimated that current business volume of the catering trade is about 10 per cent up year on year.
Supported by rent cuts , tax reductions and some other relief measures, Hong Kong's retail industry has been picking up its old pace very quickly.
Since the beginning of July, 130,000 customers have shopped in Causeway Bay's Time Square, the best known department store in Hong Kong. The number of customers is 10 per cent up over last July's.
The benchmark of Hong Kong's economy, the Hang Seng Index plunged once to 8,400 points, a four-and-a-half-year low, when SARS prevailed in Hong Kong.
With the curbing of SARS, the Hang Seng Index has been picking up gradually. In June, it broke 10,000 points with daily transaction volume hitting HK$10 billion (US$1.28 billion) several times.
Although the market has continued to experience ups and downs since the beginning of June, there is a general upward trend.
Another important indicator of Hong Kong's economy, the real estate sector, saw improvements recently. In the first half of July, 3,586 real estate deals were registered, up 28 per cent over deals in June. And transaction volume surged 42.2 per cent over June's to HK$6.63 billion (US$850 million).
The deficit of the Hong Kong Special Administrative Region government for the fiscal year ending in March was US$61.7 billion (US$7.91 billion), according to the latest announcement of the government.
The deficit represented an improvement of HK$8.3 billion over the revised estimated deficit of HK$70 billion announced in the Budget in March.
Fiscal revenue was HK$4.1 billion more than expected, largely as a result of increased revenue from Exchange Fund investments, profits and income taxes, land premiums and collections from the Housing Society under the Home Starter Loan Scheme.
According to an economic analysis published by Hong Kong's East Asia Bank, the government's HK$11.8 billion relief package will lead to more economic improvements in the third quarter of this year and the economic rebound will accelerate in the last quarter of this year.
The report sees Hong Kong's GDP growth rate reaching 1.6 per cent this year.
Experts here predict that Hong Kong's domestic consumption in the second half of this year will further rebound and its re-exports will continue to pick up, to be led by the strong growth of the Chinese mainland's economy and improvement of the US economy.
Experts say the catering trade and retail and tourism sectors will continue to move upward, and the stock market and real estate are expected to maintain a steady growth. The entire economy is expected to enjoy a rising trend soon.
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