Hong Kong's Q1 GDP grew by 3.1% year-on-year

According to the Zhitong Finance APP, on May 2nd, the Census and Statistics Department of the Hong Kong Special Administrative Region government released the preliminary estimate of local Gross Domestic Product (GDP) for the first quarter of 2025. According to the preliminary estimate, the local GDP in the first quarter of 2025 increased by 3.1% compared to the same period last year, while the increase in the fourth quarter of 2024 was 2.5%.

Analyzing the various main components of local GDP, private consumption expenditure decreased by 1.2% in the first quarter of 2025 compared to the same period last year, while the decline in the fourth quarter of 2024 was 0.2%.

Government consumption expenditure, calculated according to the national economic accounting definition, recorded a real increase of 1.2% in the first quarter of 2025 compared to the same period last year, while the increase in the fourth quarter of 2024 was 2.1%.

Total local fixed capital formation increased by 2.8% in the first quarter of 2025 compared to the same period last year, while it decreased by 0.7% in the fourth quarter of 2024.

During the same period, total goods exports, calculated according to the national economic accounting definition, recorded a real increase of 8.7% compared to the same period last year, significantly faster than the 1.3% increase in the fourth quarter of 2024. Goods imports, calculated according to the national economic accounting definition, increased by 7.4% in the first quarter of 2025, while the increase in the fourth quarter of 2024 was 0.4%.

After a real increase of 6.5% in the fourth quarter of 2024, service output further increased by 6.6% in the first quarter of 2025 compared to the same period last year. Service input increased by 6.2% in the first quarter of 2025, while the increase in the fourth quarter of 2024 was 8.3%.

The seasonally adjusted local GDP, compared quarter-on-quarter, increased by 2.0% in the first quarter of 2025 compared to the fourth quarter of 2024.

A government spokesperson stated that the Hong Kong economy expanded steadily in the first quarter of 2025. According to the preliminary estimate, the real local GDP grew by 3.1% year-on-year, accelerating from the previous quarter's increase of 2.5%. Seasonally adjusted quarter-on-quarter, the real local GDP significantly grew by 2.0%.

Analyzing by major expenditure components, overall goods exports accelerated due to sustained external demand. Benefiting from the increase in visitors to Hong Kong and other cross-border economic activities, service output continued to expand. Overall investment expenditure grew with the economic expansion. However, private consumption expenditure recorded a slight decline, reflecting the ongoing impact of changes in consumer patterns.

Looking ahead, with the sharp escalation of global trade friction due to the significant increase in import tariffs by the United States in early April, the downside risks to the global economy have significantly increased. The enormous uncertainty in trade policies will suppress international trade and investment sentiment, thus troubling the short-term outlook for the Hong Kong economy. Nevertheless, the steady growth of the mainland economy, along with various government measures to promote economic growth and explore more diversified markets, will provide support for different economic activities in Hong Kong