Hong Kong's Economy Shows Resilience Amid Global Uncertainties

Hong Kong's Financial Secretary Paul Chan stated that the city's economy remained resilient as it entered the second quarter, following a robust 5.9% growth in GDP during the first quarter. Speaking at the Legislative Council's financial affairs panel, Chan highlighted a year-on-year growth in merchandise exports of nearly 43% in April, driven by AI-related electronics products. According to RTHK, the city also experienced an increase in tourist arrivals in April and during the Labour Day Golden Week holiday, alongside improvements in the labor market. Despite these positive developments, Chan cautioned about uncertainties stemming from the Middle East conflict, noting its limited impact on Hong Kong's economy but acknowledging its role in elevating international oil prices and inflation pressures. He warned that the fragile ceasefire agreement between the US and Iran could lead to increased volatility in global financial markets, weaken external demand, and pose risks to both global and local economic outlooks. Chan expressed optimism that strong global demand for advanced electronics and AI-related products would continue to bolster exports. He also anticipated robust growth in Hong Kong's exports of services, supported by booming tourism, thriving cross-border financial activities, and stable demand for business services. Addressing the retail and catering sectors, Chan urged transformation to align with new consumption trends, noting that traditional practices might struggle to survive in the current environment. He pointed out the success of distinctive shops and cafes in various districts and encouraged industry adaptation. The government plans to provide funding and training assistance to support these sectors in their transformation efforts.