Hong Kong's GDP for the first quarter of this year fell 7.8 percent after a 2.6 percent drop in last year's fourth quarter, the Census and Statistics Department of Hong Kong Special Administrative Region announced Friday.
Taking into account the considerable mark-down in world economic outlook, GDP for 2009 as a whole is now forecast to contract by 5.5 percent to 6.5 percent in real terms, down from the forecast decline of 2 to 3 percent earlier put out in the government budget.
The latest GDP forecast is subject to an unusually large degree of uncertainty from the still evolving global financial and economic environments, the department said, adding the outbreak of influenza A/H1N1 in North America has also emerged as a new source of uncertainty.
The expected pick-up in the Mainland economy, the recent rebound in global stock markets, and the relative improvement in economic sentiment both in U.S. and Europe have provided glimpse of light at the end of a long tunnel. However, a strong recovery is not yet in sight, according to the department.
The department said the marked deterioration in first-quarter performance was due to an unprecedented fall-off in world trade as global recession plunged into the most severe recession since World War II.
Hong Kong's merchandise exports faced the double blow from a sharp plunge in global demand and an acute fall-off in intra- regional exports which were closely tied to demand in advanced economies.
Source: Xinhua
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