Gross Domestic Product for 4th Quarter 2020

GDP by expenditure component for the fourth quarter and the whole year of 2020

• In the fourth quarter of 2020, the Gross Domestic Product (GDP) decreased by 3.0% in real terms from a year earlier, compared with the decrease of 3.6% in the third quarter.  For 2020 as a whole, GDP decreased by 6.1% in real terms from 2019.
• On a seasonally adjusted quarter-to-quarter comparison basis, GDP increased by 0.2% in real terms in the fourth quarter of 2020 when compared with the third quarter.
• Analysed by major GDP component, private consumption expenditure (PCE) decreased by 7.2% in real terms in the fourth quarter of 2020 from a year earlier, smaller than the 8.2% decline in the third quarter.  For 2020 as a whole, PCE decreased by 10.1% in real terms from 2019.
• Government consumption expenditure (GCE) measured in national accounts terms grew by 5.6% in real terms in the fourth quarter of 2020 over a year earlier, after the increase of 7.1% in the third quarter.  For 2020 as a whole, GCE increased by 7.8% in real terms over 2019.
• Gross domestic fixed capital formation (GDFCF) increased by 2.6% in real terms in the fourth quarter of 2020 over a year earlier, as against the decrease of 10.9% in the third quarter.  For 2020 as a whole, GDFCF decreased by 11.5% in real terms from 2019.
• Within the total GDFCF, expenditure on machinery, equipment and intellectual property products increased by 7.8% in real terms in the fourth quarter of 2020 over a year earlier, as against the decrease of 20.1% in the third quarter.
• On the other hand, expenditure on building and construction in GDFCF dropped by 6.0% in real terms in the fourth quarter of 2020 from a year earlier, after the decline of 10.5% in the third quarter.  Within this category, expenditure on building and construction in respect of private and public sectors decreased by 13.2% and increased by 10.4% respectively in real terms in the fourth quarter of 2020.
• Over the same period, total exports of goods recorded an increase of 5.5% in real terms over a year earlier, compared with the increase of 3.9% in the third quarter.  Imports of goods grew by 6.9% in real terms in the fourth quarter of 2020, compared with the increase of 1.9% in the third quarter.  For 2020 as a whole, total exports of goods and imports of goods recorded decreases of 0.3% and 2.1% respectively in real terms from 2019.
• Exports of services fell by 29.3% in real terms in the fourth quarter of 2020 from a year earlier, compared with the decrease of 33.5% in the third quarter.  Imports of services decreased by 35.5% in real terms in the fourth quarter of 2020, compared with the decrease of 36.0% in the third quarter.  For 2020 as a whole, exports of services and imports of services recorded decreases by 36.8% and 35.1% respectively in real terms from 2019.
• The implicit price deflator (IPD) of GDP, as a broad measure of overall inflation in the economy, decreased by 1.1% in the fourth quarter of 2020 from a year earlier, as against the increase of 0.8% in the third quarter.  For 2020 as a whole, the IPD of GDP increased by 0.8% over 2019.
• As compared with the figures published in the last quarterly report, after incorporation of the latest information available, the year-on-year rate of change of GDP in real terms for the third quarter of 2020 was revised from -3.5% to -3.6%.  As compared with the advance estimates released on 29 January 2021, the year-on-year rate of change of GDP in real terms for the fourth quarter of 2020 remained at the decrease of 3.0%; and the real growth on a seasonally adjusted quarter-to-quarter comparison basis also remained unchanged.

GDP by economic activity for the third quarter of 2020

• The preliminary figures of chain volume measures of GDP by economic activity for the third quarter of 2020, which had already been released in late December 2020, were subsequently revised as more data became available.
• The revised figures showed that net output in respect of all the services activities taken together decreased by 5.5% in real terms in the third quarter of 2020 from a year earlier, compared with the 9.0% decrease in the second quarter.  The Hong Kong economy saw some improvement in the third quarter of 2020, having hit the trough in the second quarter.  This was attributable to an improved external trading environment amid the accelerated growth of the Mainland economy, the stabilisation of the third wave of local epidemic in the latter part of the quarter and stronger financial market activity.  However, the decline of industries related to consumption and tourism remained noticeable, though the fall in some of them moderated.
• Analysed by constituent services sector and on a year-on-year comparison, net output in the import and export, wholesale and retail trades sector dropped by 9.1% in real terms in the third quarter of 2020 from a year earlier, after the decrease of 18.7% in the second quarter.
• Net output in the accommodation services (covering hotels, guesthouses, boarding houses and other establishments providing short term accommodation) and food services sector decreased by 45.2% in real terms in the third quarter of 2020 from a year earlier, after the fall of 44.5% in the second quarter.
• Net output in the transportation, storage, postal and courier services sector decreased by 41.8% in real terms in the third quarter of 2020 from a year earlier, following the decline of 49.4% in the second quarter.
• Net output in the real estate, professional and business services sector decreased by 4.1% in real terms in the third quarter of 2020 from a year earlier, compared with the decline of 5.9% in the second quarter.
• Net output in the public administration, social and personal services sector dropped by 0.8% in real terms in the third quarter of 2020 from a year earlier, compared with the 3.0% decrease in the second quarter.
• Net output in the information and communications sector increased by 2.1% in real terms in the third quarter of 2020 over a year earlier, compared with the growth of 0.9% in the second quarter.
• Net output in the financing and insurance sector increased by 5.1% in real terms in the third quarter of 2020 over a year earlier, compared with the 3.0% rise in the second quarter.
• As for sectors other than the services sectors, net output in the local manufacturing sector dropped by 7.4% in real terms in the third quarter of 2020 from a year earlier, compared with the decrease of 5.1% in the second quarter.
• Net output in the electricity, gas and water supply, and waste management sector decreased by 9.4% in real terms in the third quarter of 2020 from a year earlier, compared with the decrease of 12.2% in the second quarter.
• Net output in the construction sector decreased by 10.2% in real terms in the third quarter of 2020 from a year earlier, after the decrease of 3.5% in the second quarter.

GDP by economic activity at current prices for 2019

• Statistics on GDP by economic activity 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 2019 showed that the financing and insurance sector accounted for the largest share (21.2%) of the GDP, followed by the public administration, social and personal services sector (19.6%), and the import and export, wholesale and retail trades sector (19.5%).

GNI for the third quarter of 2020

• The preliminary figures of Gross National Income (GNI) for the third quarter of 2020, which were released in mid-December 2020, were also revised accordingly based on the revised GDP estimates.
• In the third quarter of 2020, GNI decreased by 1.9% from a year earlier to $743.6 billion at current market prices, compared with the 7.4% decrease in the second quarter of 2020.
• Measured at current market prices, the value of GNI was larger than GDP by $44.8 billion in the third quarter of 2020, representing a net external primary income inflow of the same amount, and equivalent to 6.4% of GDP in that quarter.
• After netting out the effect of price changes, real GNI decreased by 1.7% in the third quarter of 2020 from a year earlier.
• Total primary income inflow into Hong Kong, estimated at $401.7 billion in the third quarter of 2020 and equivalent to 57.5% of GDP in that quarter, decreased by 8.9% from a year earlier.  As for the major components of total primary income inflow, direct investment income (DII), portfolio investment income (PII), other investment income (OII) and income on reserve assets decreased by 3.7%, 1.6%, 48.8% and 38.0% respectively from a year earlier.
• Total primary income outflow, estimated at $357.0 billion in the third quarter of 2020 and equivalent to 51.1% of GDP in that quarter, decreased by 11.2% from a year earlier.  Regarding the major components of total primary income outflow, DII, PII and OII decreased by 6.2%, 10.5% and 50.1% respectively from a year earlier.
• Taking the inflow and outflow together, a net external primary income inflow of $44.8 billion was recorded in the third quarter of 2020, compared with the net income inflow of $60.8 billion in the second quarter of 2020.