Gross Domestic Product for the 4th quarter 2008 and the whole year of 2008

GDP by expenditure component for the fourth quarter of 2008 and the whole year of 2008

• In the fourth quarter of 2008, the Gross Domestic Product (GDP) declined by 2.5% in real terms from a year earlier, as against the 1.7% increase in the third quarter. For 2008 as a whole, GDP recorded a growth of 2.5% in real terms over 2007.
• On a seasonally adjusted quarter-to-quarter comparison basis, GDP declined by 2.0% in real terms in the fourth quarter of 2008. 
• Analysed by major GDP component, private consumption expenditure (PCE) dropped by 3.2% in real terms in the fourth quarter of 2008 from a year earlier, after a zero change in the third quarter. For 2008 as a whole, PCE increased mildly by 1.8% in real terms over 2007.
• Government consumption expenditure (GCE) in national accounts terms increased by 2.6% in real terms in the fourth quarter of 2008 over a year earlier, compared with the 2.0% increase in the third quarter. For 2008 as a whole, GCE increased by 2.0% in real terms over 2007.
• Gross domestic fixed capital formation (GDFCF) decreased markedly by 17.3% in real terms in the fourth quarter of 2008, in contrast to the 3.2% growth in the third quarter. For 2008 as a whole, GDFCF registered a marginal decline of 0.3% in real terms compared with 2007.
• Within the total GDFCF, expenditure on machinery, equipment and computer software also decreased significantly by 18.7% in real terms in the fourth quarter of 2008 from a year earlier, reversing the 10.6% increase in the third quarter.
• Expenditure on building and construction decreased by 3.6% in real terms in the fourth quarter of 2008 from a year earlier, compared with a decrease of 4.1% in the third quarter.
• Expenditure on building and construction of the private sector decreased by 8.0% in real terms in the fourth quarter of 2008 while that of the public sector registered a growth of 11.4%.
• Over the same period, total exports (comprising re-exports and domestic exports) decreased by 4.9% in real terms, as against the 1.4% increase in the third quarter of 2008. Imports of goods declined by 6.4% in real terms in the fourth quarter of 2008. For 2008 as a whole, total exports and imports of goods recorded an increase of 2.0% and 1.9% in real terms respectively over 2007.   
• Exports of services decreased marginally by 0.2% in real terms in the fourth quarter of 2008 from a year earlier, as compared to the 5.1% increase in the third quarter of 2008. Imports of services dropped by 2.5% in real terms in the fourth quarter. For 2008 as a whole, exports and imports of services grew by 5.6% and 3.2% in real terms respectively.
• The implicit price deflator (IPD) of GDP, as a broad measure of overall inflation in the economy, was virtually unchanged in the fourth quarter of 2008 over a year earlier, moderating notably from the 1.8% increase in the third quarter. For 2008 as a whole, the IPD of GDP increased by 1.4%.   
• After incorporation of the latest information available, the GDP real growth rate for the third quarter of 2008 was 1.7%, same as the preliminary figure published in November 2008. The GDP real growth rate for the second quarter of 2008 was revised slightly upwards from 4.2% to 4.3%. 

GDP by economic activity for the third quarter of 2008 

• The preliminary figures of chain volume measures of GDP by economic activity for the third quarter of 2008, which were released in mid-December 2008, were revised as more data became available.
• The revised figures showed that net output in all the service activities taken together rose by 1.9% in real terms in the third quarter of 2008 over a year earlier, after the growth of 4.0% in the second quarter.  
• Analysed by constituent sector and on a year-on-year comparison, net output in the wholesale, retail and import and export trades, restaurants and hotels sector increased by 4.3% in real terms in the third quarter of 2008 over a year earlier, compared with the 7.1% rise in the second quarter. The moderation of growth from the second quarter was mainly attributable to the decelerated growth in external trade and slackened consumer spending towards the end of the quarter. 
• Net output in the transport, storage and communications sector increased by 2.0% in real terms in the third quarter of 2008 over a year earlier, compared with the 3.8% rise in the second quarter. The modest growth of the merchandise trade amid the faltering global demand underpinned the further slowdown in growth of the transport and storage services.
• Net output in the financing, insurance, real estate and business services sector decreased marginally by 0.6% in real terms in the third quarter of 2008 from a year earlier, compared with the 3.5% increase in the second quarter. The decline was mainly caused by the continued shrinkage in trading in stocks as well as quieter fund raising activities in the third quarter.
• Net output in the community, social and personal services sector increased by 1.6% in real terms in the third quarter of 2008 over a year earlier, compared with the 1.5% rise in the second quarter.
• Net output in the local manufacturing sector decreased by 6.7% in real terms in the third quarter of 2008 from a year earlier, compared with the decrease of 4.1% in the second quarter. 
• Net output in the electricity, gas and water sector decreased by 1.5% in real terms in the third quarter of 2008 from a year earlier, compared with the decrease of 3.4% in the second quarter.
• As for the construction sector, net output decreased by 3.5% in real terms in the third quarter of 2008 from a year earlier, compared with the decrease of 0.6% in the second quarter.

GDP by economic activity at current prices for 2007

• The GDP by economic activity statistics at current prices which are compiled mainly based on data collected from the annual economic surveys are useful for analysis of the contribution of different economic activities to the total GDP.
• The revised figures of GDP by economic activity at current prices for 2007 showed that the financing, insurance, real estate and business services sector accounted for the largest share (29.1%) of the GDP, followed by the wholesale, retail and import and export trades, restaurants and hotels sector (26.9%), and the community, social and personal services sector (17.1%).