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Statistics on Hong Kong's Gross National Income (GNI) (formerly known as Gross National Product (GNP)) and external primary income flows (formerly known as external factor income flows) for the second quarter of 2012 were released today (September 14) by the Census and Statistics Department (C&SD).
In the second quarter of 2012, Hong Kong's GNI increased by 2.5% over a year earlier to $495.8 billion at current market prices. The Gross Domestic Product (GDP), estimated at $474.7 billion at current market prices in the same quarter, recorded a 3.9% increase over the same period. Compared with GDP, the value of GNI was larger by $21.1 billion in the second quarter of 2012, representing a net external primary income inflow of the same amount, and equivalent to 4.5% of GDP in that quarter.
After netting out the effect of price changes, Hong Kong's GNI decreased by 1.3% in real terms in the second quarter of 2012 compared with a year earlier. The corresponding GDP in the same quarter increased by 1.2%.
Total primary income inflow into Hong Kong, estimated at $303.5 billion in the second quarter of 2012 and equivalent to 63.9% of GDP in that quarter, increased by 6.6% over a year earlier. Meanwhile, total primary income outflow, estimated at $282.4 billion in the second quarter of 2012 and equivalent to 59.5% of GDP in the same period, increased by 9.5% over a year earlier. Taking the inflow and outflow together, a net external primary income inflow of $21.1 billion was recorded in the second quarter of 2012.
Within total primary income inflow, direct investment income (DII) increased by 7.0% compared with a year earlier, mainly due to the increase in earnings of some prominent local enterprises from their investment abroad. Portfolio investment income (PII) increased by 5.1%, mainly attributable to the increase in dividend income received from holdings of non-resident equity securities by resident investors. Other investment income (OII) increased by 18.4%, mainly due to the increase in the interest rates of the overseas banking sector. On the other hand, income on reserve assets decreased by 4.9%, as a result of the decrease in investment earnings from foreign currency reserves.
Within total primary income outflow, DII increased by 8.5% compared with a year earlier, mainly attributable to the increase in earnings of some prominent multinational enterprises from their direct investment in Hong Kong. PII increased by 14.4%, mainly attributable to the increase in dividend payout to non-resident investors from their holdings of resident equity securities. OII increased by 13.2%, largely caused by the increase in liabilities of the local banking sector due to other investment.
Analysed by country/territory, the mainland of China continued to be the largest source of Hong Kong's external primary income inflow in the second quarter of 2012, accounting for 45.5%. This was followed by the British Virgin Islands (BVI), with a share of 24.8%. Regarding external primary income outflow, the mainland of China and the BVI remained the most important destinations in the second quarter of 2012, accounting for 26.8% and 23.9% respectively.
Further information
GDP and GNI are closely related indicators for measuring economic performance. GDP is a measure of the total value of production of all resident producing units of an economy. GNI denotes the total income earned by residents of an economy from engaging in various economic activities, irrespective of whether the economic activities are carried out within the economic territory of the economy or outside. In other words, GNI is obtained by adding to GDP the primary income earned by residents from outside the economic territory and deducting primary income earned by non-residents from within the economic territory. Primary income comprises investment income and compensation of employees.
Figures of external primary income flows (EPIF) presented above are compiled based on data obtained from the Survey of External Claims, Liabilities and Income conducted quarterly by the C&SD, supplemented by data from other sources.
The entire GNI and EPIF data series have been revised following the completion of a technical exercise by the C&SD in mid-September 2012 to incorporate the latest international statistical standards of the United Nations' System of National Accounts 2008 in the GDP compilation framework of Hong Kong, and those stipulated in the International Monetary Fund's Sixth Edition of the Balance of Payments and International Investment Position Manual in the compilation of EPIF figures. The revised data series of GNI and EPIF backdated to 1993, together with the conceptual and methodological details of the technical revision, are presented in the Special Report on Gross Domestic Product - September 2012 published by the C&SD. This publication can be downloaded free of charge at the website of the C&SD (www.censtatd.gov.hk/hkstat/sub/sp250.jsp?productCode=B1030003).
Besides, to follow international recommendations and in line with the practices of other economies, GNP has been renamed as GNI after the aforesaid technical revision to emphasise the fact that this indicator is essentially a measure of income. Also, the previous term "external factor income flows" (EFIF) has been renamed as "external primary income flows" (EPIF) to align with international standards.
Compiled on the basis of the revised data series subsequent to the technical revision, figures of GNI and EPIF analysed by income component from the third quarter of 2010 to the second quarter of 2012 are presented in Table A, while selected major country/territory breakdowns of external primary income inflow and external primary income outflow for the same quarters are presented in Tables B(1) and B(2) respectively.
Statistics on GNI from 2010 onwards and EPIF from 2011 onwards are preliminary figures. They are subject to revision when more data become available.
Enquiries about GNI and EPIF statistics may be directed to the Balance of Payments Branch (2) of the C&SD at 2116 5102.
Ends/Friday, September 14, 2012
Issued at HKT 16:30
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