HONG KONG: The Hong Kong government upgraded the city’s full-year economic growth target on Friday after strong stock and property markets and an improved global environment propelled the economy to faster than expected growth in the second quarter of this year. But economists warned that geopolitical tensions including intensified rhetoric between the United States and North Korea as well as the recent border dispute between China and India had cast a shadow over regional financial markets, which suffered their biggest losses of the year on Friday.
Gross domestic product in the second quarter grew 3.8 per cent, following growth of 4.3 per cent in the previous quarter, according to official figures. It beat the 3.3 per cent average forecast by analysts. “Taking into account the stronger-than-expected actual growth outturn of 4 per cent in the first half of the year and receding downside risks in the external environment, the real GDP growth forecast for 2017 as a whole is revised upwards to 3 to 4 per cent in the current round of review, from that of 2 to 3 per cent,” deputy government economist Andrew Au Sik-hung said. The revision is more aggressive than that indicated by finance chief Paul Chan Mo-po last month. He suggested a rise of only half a percentage point.