Hong Kong's Legislative Council continued its joint debate on the city's first five-year plan and the latest Policy Address.

Financial Secretary Paul Chan Mo-po stated that despite a complex and volatile international political and economic landscape this year, Hong Kong's economy grew 5.1% year-on-year in the first half of 2025, marking its strongest half-year performance in nearly five years. He noted that the current positive economic momentum has not come easily and that it is essential to set a clear direction for sustained high-quality development in the next phase. He expressed confidence that Hong Kong will achieve the revised full-year economic growth forecast of 3.5% to 4.5%.

Where the momentum stands

Chan pointed out that recent data shows the Hong Kong economy continued to expand in the third quarter. Merchandise exports performed strongly, with total export value surging 52% year-on-year for July and August combined, marking 19 consecutive months of double-digit growth. Visitor arrivals continued to rise, with preliminary figures showing a 9% year-on-year increase in the third quarter and nearly 41 million cumulative arrivals in the first nine months. Total retail sales value rose for 16 consecutive months, posting steady growth of 5.1% for July and August combined. The labour market remained broadly stable, with the latest seasonally adjusted unemployment rate for June to August standing at 3.8%, while residents' employment income continued to grow.

Asset market developments

On the asset market front, Chan said Hong Kong's property market has been recovering since mid-last year, with home prices rising 7% overall this year and rents continuing their upward trend with a cumulative gain of 5% so far this year. Stock market trading was brisk, with average daily turnover reaching HK$272.9 billion in the first nine months, nearly 10% higher than the full-year average of last year. The IPO market was also very active, with 118 initial public offerings in the first nine months raising HK$388 billion, surpassing the full-year scale of last year.

Risks on the horizon

Chan continued that external headwinds remain, and the Hong Kong government will closely monitor inflation trends in major economies, the policy direction of major central banks, as well as risks posed by trade protectionism and the global artificial intelligence boom.