Hong Kong is headed for its best quarterly economic performance in nearly five years, the city's financial secretary said over the weekend, pointing to rising tourism and stronger consumer spending as key drivers.
Financial Secretary Paul Chan Mo-po, writing in his regular Sunday blog, said the figures reflect a resilient economy despite what he described as a complex and rapidly changing external environment.
Tourism boost during Labour Day holiday
Chan highlighted that 602,000 visitors entered Hong Kong during the first two days of mainland China's Labour Day 'golden week', a 6 per cent increase compared to the same period last year, according to the South China Morning Post.
Overall visitor numbers rose 17 per cent, while retail and catering activity recorded a 5.2 per cent increase, Chan said. The golden week holiday, which typically brings a significant influx of mainland tourists to the city, has long served as a barometer for consumer sentiment and cross-border travel demand.
Broader economic context
Hong Kong's economy has faced sustained pressure in recent years from a range of factors, including the aftermath of the COVID-19 pandemic, elevated global interest rates, and ongoing geopolitical tensions between the United States and China that have weighed on trade and investment flows.
The city has also worked to reposition itself as a financial and tourism hub following the social unrest of 2019 and the strict public health restrictions that remained in place until early 2023. Visitor numbers dropped sharply during that period, hitting the hospitality, retail, and food and beverage sectors hard.
The latest data, if sustained through the full quarter, would mark a notable turnaround. Chan did not specify the exact projected growth rate but indicated the trajectory pointed to the strongest reading since around 2020.
Caution remains
Despite the optimistic tone, Chan acknowledged that external headwinds persist. Global trade tensions, particularly those stemming from shifting U.S. tariff policy, continue to cloud the outlook for export-oriented economies across Asia.
Analysts have previously cautioned that Hong Kong's recovery remains uneven, with property prices still under pressure and some segments of the retail sector yet to fully rebound to pre-pandemic levels.
The government is expected to release official first-quarter gross domestic product figures in the coming weeks, which will offer a clearer picture of whether the momentum Chan described translates into the headline growth numbers.
