Tokyo, Japan - 05-05-2021 (PR Distribution™) -
Hong Kong’s economy records best growth since 2010 after a year and a half of the worst recession ever. KL Winterbourne Associates warn that the recovery is still uneven.
Hong Kong’s economy began a recession that lasted a record 6 quarters in the third quarter of 2019. Dealing with significant headwinds including social unrest, the damaging fallout of the trade war between the US and China and the impact of the coronavirus pandemic, Hong Kong’s economy contracted by 9.1 percent in the first quarter of last year. Analysts at KL Winterbourne Associates noted that this was a record low for Hong Kong.
Advanced forecasts have shown that Hong Kong could experience a V-shaped recovery – a sharp dip, followed by an equally sharp upturn. In the first quarter of this year Hong Kong’s economy grew by 7.8 percent. This was the best economic performance since the same period 11 years ago.
However, analysts at KL Winterbourne have warned that this data is partly distorted by the extremely low level of economic activity a year ago when the city’s economy was in lockdown. A more accurate reflection of growth is the quarter-on-quarter expansion which also exceeded expectations by reaching 5.3%. Economists had anticipated growth of around 0.7%.
Although analysts at KL Winterbourne Associates say that Hong Kong’s economic recovery remains uneven and economic activity has not yet returned to pre-pandemic levels, the economy is expected to expand by between 3.5 and 5.5 percent this year.
At this stage, recovery relies heavily on regions being able to control their coronavirus outbreak. Hong Kong has had a relatively low rate of vaccination with a large portion of the population unwilling to be vaccinated. This could hamper Hong Kong’s ability to fully recover from the health crisis.
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