The Economy | 59
in the fourth quarter. Yet exports of travel services stayed vibrant with very strong growth throughout the year, thanks to the rapid increase in visitor arrivals, especially those from the Mainland. Exports of financial and business services were likewise resilient during most of the year, on the back of buoyant cross-border financing, fund raising and other commercial activities. These two components provided a strong cushion against the slack in the trade-related components in 2011.
Imports of services grew modestly by 3.1 per cent in real terms in 2011, following a sharp increase of 10.7 per cent in the previous year. Growth in imports. of financial and other business services moderated along with the worsening external environment. Imports of transportation and trade-related services slowed more conspicuously in tandem with the slowdown in regional trade flows. Meanwhile, imports of travel services showed only a small growth in 2011 (Chart 9).
Chart 9
Hong Kong's Invisible Trade (year-on-year rate of change in real terms)
Per cent
20
15
10
5
0
-5
-10
-15
Imports of services
Exports of services
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2007
2008 1 2009
2010
2011
Exports of services were more resilient, though also moderating in the latter part of 2011.
Due to the strong headwinds in the external environment and buoyant domestic demand, visible trade deficit widened in 2011. Nevertheless, the invisible trade surplus was still more than enough to offset the visible trade deficit. In 2011, the combined visible and invisible balance posted a surplus of $69.7 billion, or 1.6 per cent of the total value of imports of goods and services, though smaller than the surplus of $94.7 billion or 2.5 per cent in 2010.
Domestic demand
The domestic sector fared remarkably well in 2011, rendering the key impetus to overall economic growth. Local consumer sentiments were buoyed by the broad- based income and job growth over the past year or so. Private consumption expenditure (PCE) grew robustly in real terms in all four quarters of 2011. For 2011