The Government released today (August 15) the Half-yearly Economic Report 2014, together with the preliminary figures on Gross Domestic Product (GDP) for the second quarter of 2014.

The Hong Kong economy slowed down further to a mere 1.8% year-on-year growth in real terms in the second quarter of 2014, from 2.6% in the first quarter, marking the slowest growth since the third quarter of 2012. The weak performance was mainly weighed down by a fall-off in tourist spending and a concurrent slowdown in domestic demand. On a seasonally adjusted quarter-to-quarter comparison, real GDP dipped by 0.1% in the second quarter, after a 0.3% growth in the preceding quarter.

The Government Economist Helen Chan stated looking forward, the global economy is expected to remain on a moderate recovery path in the rest of 2014. This, together with an improving Mainland economy, should entail a somewhat brighter export outlook for Hong Kong in the period ahead, though the scope of rebound might continue to be held back by the rather fragile recovery of the advanced markets.

In cognisance of the worse-than-expected outturn in the first half of 2014, and even taking into account some possible relative stabilisation in economic performance in the latter part of the year, the Hong Kong economy is only poised to attain modest growth for this year as a whole. The GDP growth forecast for 2014 as a whole is thus revised downward from 3-4% in the May round of review to 2-3% in the current round.