HONG KONG: Hong Kong’s economy grew by 3.1 percent in the first quarter of this year compared to the same period last year, according to early government estimates.

This marks the ninth quarter in a row of economic growth and was better than the 2.1 percent growth expected by economists in a Reuters poll.

In the previous quarters, Hong Kong reported 2.5 percent growth in Q4 2024, 1.9 percent in Q3, 3.0 percent in Q2, and 2.8 percent in Q1 of 2024. The government said the latest development was helped by strong exports and a rise in tourist arrivals, which supported services. Investment spending also increased.

However, people in Hong Kong spent less on daily goods and services, as many tightened their budgets and crossed the border to shop in mainland China, where prices were lower due to a strong Hong Kong dollar.

On a quarterly basis (compared to the previous quarter), the economy grew 2.0 percent from January to March, up from 0.9 percent from October to December and following a small drop of 0.1 percent between July and September.

Goods exports rose 8.7 percent in the first quarter, much higher than the 1.3 percent growth in the fourth quarter. Imports also increased by 7.4 percent, compared to just 0.4 percent growth in the previous quarter.

However, private consumption dropped by 1.2 percent, showing that households were still cautious with spending.

Looking ahead, the government warned that rising global trade tensions, mainly due to new U.S. tariffs in April, could hurt international trade and business confidence. However, it said strong growth in mainland China may help support Hong Kong’s economy in the near future.