University of Hong Kong economists have revised downward their estimate of the city’s economic growth for the first quarter to 2.1 percent from 2.4 percent, as a result of a stronger currency.
Wong Ka-fu, HKU’s chief lecturer in economics, said the impact of a stronger Hong Kong dollar — which is caused primarily by its peg to the strengthening US dollar and dampens demand for the city’s exports — will soon be reflected in economic data, the Hong Kong Economic Journal reported Friday.
However, given rising demand from the United States, exports of goods are expected to rise 3.1 percent in the first quarter and 5.1 percent in the second, HKU said in its latest report on the economy.
The report recommended that the Hong Kong government impose a HK$10 departure levy on visitors leaving the city through land control points or marine ports, so as to mitigate the negative influence of parallel goods traders from mainland China.
It also warned of downward pressure on asset values and property prices when the US raises its key interest rate, which it is expected to do later this year.
Translation by Vey Wong
[Chinese version 中文版]
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