HK's GDP up 2.2 percent in first quarter

Hong Kong's Gross Domestic Product (GDP) in the first quarter of this year is estimated at 301.9 billion HK dollars (38.70 billion US dollars) at current market prices, increased by 2.2 percent over a year earlier.

According to a press release of Hong Kong's Census and Statistics Department Friday, the total factor income inflow into Hong Kong is estimated at 94.7 billion HK dollars (12.14 billion US dollars) in the first quarter of 2004 increased considerably by 16.6 percent over a year earlier.

The department said that within the total factor income inflow, direct investment income (DII) inflow increased significantly by 34.3 percent in the first quarter of 2004 over a year earlier, mainly due to increased earnings of some prominent local enterprises from investment abroad.

Portfolio investment income (PII) inflow also increased by 9.0 percent in the first quarter, mainly attributable to the increase in dividend pay-outs by some prominent non-resident publicly listed companies during the period.

Within the total factor income outflow, DII outflow recorded significant increase of 37.9 percent in the first quarter of 2004 over a year earlier, reflecting a sustained growth in earnings from direct investment in Hong Kong upon robust recovery of the local economy. PII outflow also increased substantially by 14.0 percent, mainly attributable to increase in dividend pay-outs by a number of resident publicly listed companies. OII outflow continued to drop, by 18.4 percent, on account of lower interest rates during the quarter.

A government secretariat spokesman noted that external factor income inflow and outflow both leaped remarkably further in the first quarter of 2004 over a year earlier. This was primarily driven by significant double-digit increases in direct investment income both from Hong Kong and from overseas economies, upon further robust recovery in the local economy and a sustained pick-up in the global economy.

The spokesman pointed out that external factor income inflow and outflow remained sizable in the first quarter of 2004, both accounting for more than one-fourth of Hong Kong's GDP. This reflected the highly externally oriented nature of the Hong Kong economy on the one hand, and its position as an international financial center in facilitating external investment activities on the other.