The Economy | 51
Imports of services posted a modest growth of 3.2 per cent in real terms in 2008, down from 12.1 per cent in 2007. The moderation was across all sectors. Imports of travel services dropped after the rapid increase in the first quarter of 2008, along with weaker consumer sentiment. Imports of transportation services similarly decelerated over the course of 2008. With financial market activities much battered after the global financial crisis, imports of financial, business and other services had a much slower growth in 2008 in contrast to the surge in 2007. Imports of trade-related services also underwent a marked deterioration in the fourth quarter of 2008, again due to receding trade flows in the Asian region in the final months of the year (Chart 8).
Chart 8
Hong Kong's Visible Trade
(year-on-year rate of change in real terms)
Per cent
20
15
10
5
0
-5
Exports of services
Imports of services
-10
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Exports of services decelerated markedly in the second half of 2008 amid the growing global financial crisis.
With the surplus in the invisible trade account more than offsetting the deficit in the merchandise trade account, a sizeable surplus of $182.5 billion was recorded in the combined visible and invisible trade balance in 2008, equivalent to 5.4 per cent of the total value of imports of goods and services. This compared with the corresponding figures of $174.8 billion and 5.5 per cent in 2007. The continued sizeable surplus is a reflection of Hong Kong's resilience in meeting the challenges posed by the external shocks.
Domestic Demand
Domestic demand held up relatively well in the first quarter, but slowed distinctly in the following three quarters of 2008. The deceleration in private consumption was particularly evident in the second half of the year, due to the negative wealth effect arising from the correction in the local asset markets, as well as the deterioration in job prospects. For 2008 as a whole, private consumption
No comments yet.
Private notes are available after approval.