The latest Macroecomomic Forecast, which was released on Friday, showed a positive trend of Hong Kong 's economic growth, as the GDP forecast for this year is being revised upwards to 5.74 percent.

This economic forecast, commissioned by the Better Hong Kong Foundation, was conducted by the Center for Economic Development of the Hong Kong University of Science and Technology.

George Yuen, chief executive of the Better Hong Kong Foundation, said at a press release for forecast that "it is encouraging that the GDP forecast for year 2005 is being revised upwards again. with the latest at 5.74 percent."

He said such a robust projection is more or less a result of buoyant domestic consumption, brisk financial markets, and favorable investment environment, which are underpinned by the central government's preferential support.

He added that "strong performance of our major trading partners ' economy has positive impact on our business activities. "

Professor Francis Lui, director of the Center for Economic Development, said "the economy this year is doing well. We therefore revised our forecast of GDP growth upwards from 5.6 percent to 5.74 percent. This trend of robust growth would likely continue."

"The unemployment rate has remained stagnant, as we forecast the seasonally adjusted rate to be 5.76 percent by the end of this year," he added.

Lui said inflation rate is still very moderate and the growth of total export would be 10 percent for the full year of 2005.

However, in spite of a positive trend of 2005, we suspect whether such trend would be maintained next year, particularly after three years of continuos expansion, the economy may slow down a bit, he said.

The forecast of the economic indicators include real GDP, labor market, price movement and international trade.

Yuen cautioned against being over optimistic about the rosy picture of 2005. "Looking ahead of 2006, we have to be cautious, as business cycle and history do tell us -- a slowdown will appear after a series of continued growth," he said.

Source: Xinhua