Gross Domestic Product for 4th Quarter and the whole year of 2022

GDP by expenditure component for the fourth quarter and the whole year of 2022

• In the fourth quarter of 2022, the Gross Domestic Product (GDP) decreased by 4.2% in real terms from a year earlier, compared with the decrease of 4.6% in the third quarter. For 2022 as a whole, GDP decreased by 3.5% in real terms from 2021.
• On a seasonally adjusted quarter-to-quarter comparison basis, GDP remained virtually unchanged in real terms in the fourth quarter of 2022 when compared with the third quarter.
• Analysed by major GDP component, private consumption expenditure (PCE) increased by 1.9% in real terms in the fourth quarter of 2022 over a year earlier, as against the small decline of 0.4% in the third quarter. For 2022 as a whole, PCE decreased by 1.0% in real terms from 2021.
• Government consumption expenditure (GCE) measured in national accounts terms grew by 9.1% in real terms in the fourth quarter of 2022 over a year earlier, after the increase of 5.3% in the third quarter. For 2022 as a whole, GCE increased by 8.1% in real terms over 2021.
• Gross domestic fixed capital formation (GDFCF) decreased by 10.9% in real terms in the fourth quarter of 2022 from a year earlier, compared with the decrease of 14.4% in the third quarter. For 2022 as a whole, GDFCF decreased by 8.5% in real terms from 2021.
• Within the total GDFCF, expenditure on machinery, equipment and intellectual property products decreased by 20.7% in real terms in the fourth quarter of 2022 from a year earlier, compared with the decrease of 27.0% in the third quarter.
• On the other hand, expenditure on building and construction in GDFCF rose by 4.1% in real terms in the fourth quarter of 2022 over a year earlier, compared with the increase of 2.1% in the third quarter. Within this category, expenditure on building and construction in respect of private and public sectors increased by 0.6% and 8.8% respectively in real terms in the fourth quarter of 2022.
• Over the same period, total exports of goods fell further by 24.9% in real terms from a year earlier, after the decrease of 15.8% in the third quarter. Imports of goods decreased by 22.9% in real terms in the fourth quarter of 2022, deteriorating from the decline of 16.4% in the third quarter. For 2022 as a whole, total exports of goods and imports of goods recorded decreases of 13.9% and 13.2% respectively in real terms from 2021.
• Exports of services increased by 2.0% in real terms in the fourth quarter of 2022 over a year earlier, as against the decrease of 4.2% in the third quarter. Imports of services increased by 3.3% in real terms in the fourth quarter of 2022, after the decrease of 3.2% in the third quarter. For 2022 as a whole, exports of services and imports of services recorded decreases of 0.9% and 1.0% respectively in real terms from 2021.
• The implicit price deflator (IPD) of GDP, as a broad measure of overall inflation in the economy, increased by 2.3% in the fourth quarter of 2022 over a year earlier, compared with the increase of 4.0% in the third quarter. For 2022 as a whole, the IPD of GDP increased by 2.2% over 2021.
• 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 in real terms in the whole year of 2021 was revised from 6.3% to 6.4%. For 2022, the year-on-year rate of change of GDP in real terms for the first quarter remained at -3.9% while that for the second and the third quarter were revised from -1.3% to -1.2% and -4.5% to -4.6% respectively. As compared with the advance estimates released on 1 February 2023, the year-on-year rate of change of GDP in real terms for the fourth quarter of 2022 remained at -4.2%, and the rate of change in real terms on a seasonally adjusted quarter-to-quarter comparison basis also remained unchanged.

GDP by economic activity for the third quarter of 2022

• The preliminary figures of chain volume measures of GDP by economic activity for the third quarter of 2022, which had already been released in late December 2022, 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 3.3% in real terms in the third quarter of 2022 from a year earlier, compared with the 1.3% decrease in the second quarter. The Hong Kong economy showed a widened year-on-year contraction in the third quarter of 2022 as a result of the worsened external environment, continued disruptions to cross-boundary transportation and tightened financial conditions.
• Analysed by constituent services sector, net output in the import and export, wholesale and retail trades sector dropped by 12.5% in real terms in the third quarter of 2022 from a year earlier, after the decrease of 6.8% 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 7.1% in real terms in the third quarter of 2022 from a year earlier, after the fall of 5.8% in the second quarter.
• Net output in the transportation, storage, postal and courier services sector decreased by 5.7% in real terms in the third quarter of 2022 from a year earlier, compared with the decrease of 3.6% in the second quarter.
• Net output in the financing and insurance sector decreased by 1.9% in real terms in the third quarter of 2022 from a year earlier, as against the increase of 1.4% in the second quarter.
• Net output in the real estate, professional and business services sector registered a decrease of 2.1% in real terms in the third quarter of 2022 from a year earlier, compared with the decline of 1.5% in the second quarter.
• Net output in the information and communications sector increased by 0.3% in real terms in the third quarter of 2022 over a year earlier, compared with the growth of 1.1% in the second quarter.
• Net output in the public administration, social and personal services sector rose by 1.7% in real terms in the third quarter of 2022 over a year earlier, as against the decrease of 0.1% in the second quarter.
• As for sectors other than the services sectors, net output in the local manufacturing sector dropped by 0.5% in real terms in the third quarter of 2022 from a year earlier, as against the increase of 2.7% in the second quarter.
• Net output in the electricity, gas and water supply, and waste management sector decreased by 1.0% in real terms in the third quarter of 2022 from a year earlier, following the decrease of 7.3% in the second quarter.
• Net output in the construction sector increased by 1.7% in real terms in the third quarter of 2022 over a year earlier, compared with the 9.3% increase in the second quarter.

GDP by economic activity at current prices for 2021

• 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 2021 showed that the financing and insurance sector accounted for the largest share (21.3%) of the GDP, followed by the public administration, social and personal services sector (20.4%), and the import and export, wholesale and retail trades sector (19.4%).

GNI for the third quarter of 2022

• The preliminary figures of Gross National Income (GNI) for the third quarter of 2022, which were released in mid-December 2022, were also revised accordingly based on the revised GDP estimates.
• In the third quarter of 2022, GNI decreased by 0.2% from a year earlier to $787.3 billion at current market prices, compared with the 2.0% decrease in the second quarter of 2022.
• Measured at current market prices, the value of GNI was larger than GDP by $62.8 billion in the third quarter of 2022, representing a net external primary income inflow of the same amount and equivalent to 8.7% of GDP in that quarter.
• After netting out the effect of price changes, real GNI decreased by 3.2% in the third quarter of 2022 from a year earlier.
• Total primary income inflow into Hong Kong, estimated at $480.2 billion in the third quarter of 2022 and equivalent to 66.3% of GDP in that quarter, increased by 7.8% over a year earlier. As for the major components of total primary income inflow, portfolio investment income (PII), other investment income (OII) and income on reserve assets increased by 13.2%, 115.3% and 64.8% respectively over a year earlier. Direct investment income (DII) decreased by 1.0% from a year earlier.
• Total primary income outflow, estimated at $417.4 billion in the third quarter of 2022 and equivalent to 57.6% of GDP in that quarter, increased by 7.9% over a year earlier. Regarding the major components of total primary income outflow, DII, PII and OII increased by 1.5%, 21.1% and 132.8% respectively over a year earlier.
• Taking the inflow and outflow together, a net external primary income inflow of $62.8 billion was recorded in the third quarter of 2022, compared with the net income inflow of $78.0 billion in the second quarter of 2022.