Hong Kong’s first-quarter economic growth stalled as exports shrank amid slumping global trade, and the government of the southern Chinese financial centre warned Friday of further risks because of Europe’s sovereign debt crisis.
The economy eked out “weak” growth of 0.4 percent in the first three months of 2012. That’s down from 3 percent growth in the previous quarter.
Exports shrank by 5.7 percent, as shipments to the US and European Union dipped further while those to Asian markets “slackened distinctly.”
The government said the decline came alongside a broader trend of declining exports among Asian countries, particularly for raw materials used to make goods shipped to advanced markets, where demand was “subdued.”
Inflation eased to 5.2 percent in the quarter as food prices and housing rents rose at a slower rate and global food and commodity prices cooled. Consumer price inflation is expected to taper off further in the coming months, the government said.
The government maintained its full year forecast for economic growth of 1 to 3 percent, bolstered by firmness in mainland China and better-than-expected growth in the US, but warned of risks elsewhere.
Hong Kong is a semiautonomous region of China. It’s a major Asian financial centre with open markets and a busy port handling a big share of goods from China, which has made it one of the region’s wealthiest economies – but also left it exposed to the ups and downs of global trade flows.
Category: Hong Kong