By Ronnie Harui
Hong Kong’s economy is forecast to grow 3.5%-5.5% this year, as pressure on the city’s exports should ease owing to the Chinese economy’s accelerated growth and the lifting of restrictions on cross-border truck movements, Financial Secretary Paul Chan said in his budget speech on Wednesday.
As sentiment improves in tandem with the revival of economic activities and the fast return of Hong Kong’s exchanges with mainland China and the world to normalcy, private consumption will increase, Mr. Chan said.
The better economic prospects will also be conducive to fixed-asset investment, although tightened financial conditions will remain a constraint, he said. Hong Kong’s economy contracted 3.5% last year, he said.
Domestic cost pressures will increase along with the economic recovery, Mr. Chan said. Despite some moderation, external price pressures will remain notable in 2023, Mr. Chan said, forecasting Hong Kong’s underlying inflation and headline inflation at 2.5% and 2.9%, respectively, for this year.
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