HK’s economic growth to moderate to 2.5% in 2024: S&P Global

The per capita real GDP is forecasted to rise by 2.2% annually during 2025 to 2027.

Hong Kong’s economic growth is expected to moderate to 2.5% in 2024, following a 3.2% gain in 2023, according to S&P Global.

“Hong Kong's economic recovery should continue this year, following the 2.7% growth in the first three months, aided by the pickup in population size and further normalisation of cross-border travel,” the report said.

“The recovery in fiscal performance, however, is slowed by the weak real estate market. In the face of declining prices, the government has recently reduced land sales. This has led to a more gradual revenue growth and a larger fiscal deficit,” it noted.

Additionally, population growth is projected to slow down, whilst per capita real GDP is forecasted to rise by 2.2% annually during 2025 to 2027, reaching US$60,000 by 2027.

Key initiatives like the development of the Greater Bay Area and financial connections with mainland China are seen as drivers of economic growth.

However, increased ties with China could expose Hong Kong to economic risks, especially amid ongoing U.S.-China tensions.

S&P Global said maintaining stability and autonomy in economic policy-making will be crucial for Hong Kong to navigate these challenges. Whilst recent legislative changes, such as the National Security Ordinance and amendments to the electoral system, may have raised concerns, it believes that Hong Kong's institutional framework remains resilient.

Efforts to address social tensions, particularly those highlighted during the 2019 protests, will also play a significant role in ensuring stability and sustaining economic growth in Hong Kong.

“The outlook is stable, reflecting our expectation that Hong Kong's economic recovery will allow the budgetary position to trend toward balance over the next three years,” S&P Global said.