Hong Kong’s economy could shrink this quarter if exports fail to improve amid faltering global growth, Hong Kong Financial Secretary John Tsang (曾俊華) said.
“I see a difficult year ahead for the global economy,” Tsang said in a transcript of a radio broadcast, posted on a government Web site on Sunday. “We might even see negative growth in the first quarter of this year if exports fail to pick up.”
In a sign of the impact weak global demand is having on Asian economies, Japan yesterday reported a fourth-quarter contraction.
China’s exports and imports fell for the first time in more than two years last month, partly because of the disruption caused by the weeklong Lunar New Year holiday, the government said last week.
“We are expecting the hit from slackening export demand to hit Hong Kong hardest in the first quarter,” said Donna Kwok (郭浩庄), an economist at HSBC Holdings PLC in Hong Kong.
A quarter-on-quarter contraction is “possible,” she said.
Tsang pledged on Feb. 1 a HK$80 billion (US$10.3 billion) boost to growth in the fiscal year starting in April, with measures including tax rebates, waivers on homeowner taxes and aid for small businesses.
GDP would rise by between 1 percent and 3 percent this year, down from 5 percent last year, the government estimated.
Tsang did not specify whether the contraction he mentioned would be year-on-year or quarter-on-quarter
In an e-mail, press secretary Patrick Wong said he believed Tsang meant the former.