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Economic growth in Hong Kong will be cut in half this year

The SARS crisis is expected to cut Hong Kong's economic growth in half this year, to 1.5 percent, economists said yesterday.

Consumer spending collapsed and other industries ranging from airlines to hotels and restaurants have been devastated, although since the problems did not emerge until mid-March the impact on first quarter growth was minimal, the government said.

Hong Kong's GDP managed to grow at a rate of 4.5 percent in the first three months of the year, but "the economic situation worsened abruptly since mid-March upon the spread of SARS," the government said.

Consumer spending plunged 2.1 percent in the quarter as SARS prompted many people to stay home rather than go out and risk catching a disease that was little understood when it first emerged.

Hong Kong had previously predicted its GDP could grow by 3.0 percent this year.
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