8
FRIDAY, AUGUST 27, 1993
IS
PURPOSES
THE DEMAND FOR IMPORTED RAW MATERIALS FOR PRODUCTION EXPECTED TO SLACKEN SOMEWHAT, IN LINE WITH THE CONTINUED SLACK DOMESTIC EXPORTS.
IN
BUT THE DEMAND FOR OTHER CATEGORIES OF RETAINED IMPORTS, PRINCIPALLY CONSUMER GOODS AND CAPITAL GOODS, SHOULD RISE FURTHER IN PARALLEL WITH THE SUSTAINED GROWTH IN DOMESTIC DEMAND.
TAKING RE-EXPORTS AND RETAINED IMPORTS TOGETHER, TOTAL IMPORTS ARE FORECAST TO GROW BY 16% IN REAL TERMS, COMPARED WITH 18.7% IN THE EARLIER FORECAST.
WITH A BETTER-THAN-EXPECTED PERFORMANCE IN BOTH INBOUND AND OUTBOUND TOURISM IN THE FIRST HALF OF THIS YEAR, THE FORECAST GROWTH RATES IN REAL TERMS OF BOTH EXPORTS AND IMPORTS OF SERVICES ARB REVISED UPWARDS TO 10% AND 8.5% RESPECTIVELY, FROM 9% AND 8%.
IN THE DOMESTIC SECTOR, CONSUMER SPENDING HAS CONTINUED TO GROW STEADILY AT QUITE A RAPID PACE.
THE SUSTAINED INCREASE IN LABOUR INCOMES AMIDST A GENERALLY TIGHT LABOUR MARKET, COUPLED WITH A POSITIVE WEALTH EFFECT AS MAY BE EXPECTED FROM THE BUOYANT PROPERTY AND STOCK MARKETS IN RECENT MONTHS, SHOULD LEND SUPPORT TO THE STRENGTH OF CONSUMER SPENDING IN THE NEAR FUTURE.
THE FORECAST GROWTH RATE IN REAL TERMS OF PRIVATE EXPENDITURE IS THUS MAINTAINED AT 7.5%.
CONSUMPTION
THE FORECAST GROWTH RATE IN REAL TERMS OF GOVERNMENT CONSUMPTION EXPENDITURE IS LOWERED FROM 4% TO 3%, MAINLY TO TAKE INTO ACCOUNT THE SLOW-DOWN OBSERVED SO FAR.
ON INVESTMENT, GIVEN THE ACCELERATION IN CONSTRUCTION OUTPUT AS A NUMBER OF MAJOR PUBLIC SECTOR INFRASTRUCTURAL PROJECTS GATHERED MOMENTUM IN RECENT QUARTERS, THE FORECAST GROWTH RATE OF PUBLIC SECTOR EXPENDITURE ON BUILDING AND CONSTRUCTION IS REVISED SUBSTANTIALLY UPWARDS.
19
BUT PRIVATE SECTOR EXPENDITURE ON BUILDING AND CONSTRUCTION EXPECTED TO REMAIN SLACK AS BUILDING ACTIVITY IS RELATIVELY SUBDUED.
AS REGARDS EXPENDITURE ON MACHINERY AND EQUIPMENT, THE FORECAST GROWTH RATE OF PRIVATE SECTOR EXPENDITURE IS REVISED DOWNWARDS IN THE LIGHT OF THE RECENT SLOW-DOWN, BUT THE FORECAST GROWTH RATE OF PUBLIC SECTOR EXPENDITURE IS SUBSTANTIALLY LIFTED.
COMBINING ALL THE INVESTMENT COMPONENTS TOGETHER, THE FORECAST GROWTH RATE IN REAL TERMS OF GROSS DOMESTIC FIXED CAPITAL FORMATION STAYS UNCHANGED AT 7.6%.
OVERALL, THE FORECAST GROWTH RATE IN REAL TERMS OF THE GDP FOR 1993 IS MAINTAINED AT 5.5%.
THIS PRESUMES THAT THE INDIRECT IMPACT OF CHINA'S RESTRAINT MEASURES ON THE HONG KONG ECONOMY, IF IT WILL COME ABOUT, WILL BE ONLY MODERATE.
/WHILE THE
+