HK's GDP to expand up to 6.5 percent: IMF
(AP)
Updated: 2005-11-08 15:51

HONG KONG (AP) _ The International Monetary Fund said Tuesday it expects Hong Kong's economic growth to expand 6 to 6.5 percent this year, but slow to about 5 percent next year, although that outlook depends on global developments and mainland China.

"Growth remains robust, recently supported by strong mainland-related exports," the IMF said in a statement issued Tuesday following its annual review of the Hong Kong economy.

The Chinese territory's economy grew 6.5 percent in the first half of the year from the same period in 2004.

The IMF noted that Hong Kong's economic expansion that began mid-2003 has been sustained for eight consecutive quarters.

The agency forecasts that the territory's gross domestic product growth in 2006 will be more moderate due to lower export growth in China. But even so, "inflation should rise modestly as rents pick up and the labor market tightens," it said.

Given its open economy and strong link with China, Hong Kong's "growth prospects depend crucially on external conditions and developments in the mainland," said the IMF.

It said Hong Kong's current driver of growth, exports, could be threatened if global demand weakens significantly.