Hong Kong may raise GDP forecast as growth poised for 5-year high: Paul Chan

Hong Kong’s economic growth this year could be the city’s strongest in five years, with potential for further upward revisions after the full-year forecast was previously raised to a range of 3.5 to 4.5 per cent, the finance chief has said.

Financial Secretary Paul Chan Mo-po said on Saturday that the city’s economy grew by 5.1 per cent in the first half of the year, driven by strong export momentum and investment growth.

“Although the third-quarter figures have not yet been released, I can share that exports remained very strong in the quarter,” he told a radio programme.

He said the strong momentum was coupled with a high volume of visitors to Hong Kong as the city hosted a variety of events such as the Wine and Dine Festival.

The coming Fintech Week would draw more visitors, while the Global Financial Leaders’ Investment Summit would gather at least 120 presidents and CEOs from financial organisations worldwide, he said.

“This year, 2026, has the potential to deliver the strongest full-year economic growth in the past five years,” he said, adding that the full-year growth forecast could be raised further.

“We’ve been keeping a close eye on the figures and tracking changes and trends. Overall this year, not just in the third quarter, but heading into the fourth quarter as well, the momentum remains quite strong.”

In August, authorities raised the city’s full-year economic growth forecast for 2026 to a range of 3.5 to 4.5 per cent following a 4.3 per cent expansion in the second quarter, supported by buoyant external trade and resilient domestic demand.

The forecast was revised from the previous range of 2.5 to 3.5 per cent, with the government citing a stronger-than-expected performance in the first half of the year and taking into account the near-term outlook.

The economy expanded by 5.1 per cent in the first half, its strongest half-yearly performance in nearly five years.

Exports of goods surged by 28.9 per cent year on year in real terms, while private consumption expenditure rose by 2.8 per cent and overall investment increased by 4.4 per cent.

On the tourism front, the city received 26.71 million visitors in the first half of this year, a 13 per cent increase from a year earlier.

In particular, the momentum in exports continued in the second half of the year.

According to data revealed on Wednesday, the city’s exports jumped by 64.9 per cent year on year in September to HK$762.6 billion (US$97.8 billion), the highest growth in more than 40 years, with artificial intelligence-related products further fuelling the momentum of recent months.

The government had earlier said September marked the 20th consecutive month of double-digit growth and the fastest monthly year-on-year increase in more than four decades.

Chan said the government would continue to foster steady economic growth, noting that while the inflation rate was influenced by oil prices, the increase had remained relatively modest, and price levels remained stable.

But he added that geopolitical factors continued to pose risks, fuelling oil prices and inflationary pressures, while interest rates that were expected to remain high into next year could put pressure on both the property market and the broader economy.

“We remain highly vigilant regarding the financial risks, and we also urge everyone to remain cautious about risks across all aspects of their investments,” he said.

Gary Ng Cheuk-yan, a senior economist at Natixis Corporate and Investment Bank, said Hong Kong’s full-year growth this year would likely reach 4.4 per cent based on the current trajectory, which was “very close” to the current government’s forecast.

He said authorities might increase the range from the revised 3.5 to 4.5 per cent further to 4 to 5 per cent.

“In the last quarter, global AI demand will continue to fuel the semiconductor super cycle and support exports,” he said.

“However, there are persisting headwinds from private consumption, especially with challenges from a weaker wealth effect from stock markets, job creation and elevated interest rates.”