Financial Secretary, Henry Tang revises GDP growth upwards

"The economy should continue to pick up in the rest of the year, and in the external sector, exports of services are expected to be vibrant," said Mr Tang. "Offshore trade is likely to remain brisk, supported by strong trade flows in the Chinese mainland and a generally improved economic environment. A continued robust external sector performance should in turn bring about beneficial spillovers to the local economy."

Export of goods, the government announced, had been relatively unaffected by Sars, maintaining double-digit growth throughout the second quarter. After a 19.1 per cent surge in real terms in the first quarter of 2003 over a year earlier, there was a further leap by 14.3 per cent in the second quarter.

Full year export numbers revised up sharply

The Hong Kong Trade Development Council (TDC) released similarly upbeat revised forecast figures for Hong Kong's 2003 exports. Chief economist Edward Leung said TDC now forecasts a 7 to 8 per cent increase for exports (in value terms), up from 3.3 per cent at the height of the Sars outbreak.

Mr Leung said the quick outcome of the war in Iraq, firmer evidence of a global economic recovery and a milder Sars impact that earlier feared by exporters had contributed to the optimistic forecast. Since the World Health Organization (WHO) removed its travel advisories on Hong Kong, business travel and export orders have recovered remarkably quickly.

"The impact of the Sars outbreak has turned out to be far more moderate than suppliers expected in May. For many, it simply meant that orders and production were postponed until later in the year. This delayed response should help sustain the export growth of Hong Kong for the second half," said Mr Leung.

More details at  www.info.gov.hk/gia/general/200308/29/0829174.htm