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Hong Kong's Gross National Income and external primary income flows for the third quarter of 2012
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     Statistics on Hong Kong's Gross National Income (GNI) and external primary income flows for the third quarter of 2012 were released today (December 14) by the Census and Statistics Department (C&SD).

     In the third quarter of 2012, Hong Kong's GNI increased by 6.3% over a year earlier to $530.4 billion at current market prices. The Gross Domestic Product (GDP), estimated at $523.3 billion at current market prices in the same quarter, recorded a 5.2% increase over the same period. Compared with GDP, the value of GNI was larger by $7.0 billion in the third quarter of 2012, representing a net external primary income inflow of the same amount, and equivalent to 1.3% of GDP in that quarter.

     After netting out the effect of price changes, Hong Kong's GNI increased by 2.5% in real terms in the third quarter of 2012 compared with a year earlier. The corresponding GDP in the same quarter increased by 1.3%.

     Total primary income inflow into Hong Kong, estimated at $263.9 billion in the third quarter of 2012 and equivalent to 50.4% of GDP in that quarter, increased by 8.7% over a year earlier. Meanwhile, total primary income outflow, estimated at $256.9 billion in the third quarter of 2012 and equivalent to 49.1% of GDP in the same period, increased by 6.3% over a year earlier. Taking the inflow and outflow together, a net external primary income inflow of $7.0 billion was recorded in the third quarter of 2012.

     As for the major components of total primary income inflow, direct investment income (DII) increased by 12.8% compared with a year earlier, mainly due to the increase in earnings of some prominent local enterprises from their direct investment abroad. Portfolio investment income (PII) decreased slightly by 1.5%, mainly attributable to the decrease in dividend income received from holdings of non-resident equity securities by resident investors. Other investment income (OII) decreased by 13.6%, mainly due to the decrease in the interest rates of the overseas banking sector. Income on reserve assets also decreased by 6.6%, as a result of the decrease in investment earnings from foreign currency reserves.

     Regarding the major components of total primary income outflow, DII increased by 7.5% 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 5.6%, mainly attributable to the increase in dividend payout to non-resident investors from their holdings of resident equity securities. OII decreased by 17.5%, largely caused by the decrease in the interest rates of the local banking sector.

     Analysed by country/territory, the mainland of China continued to be the largest source of Hong Kong's external primary income inflow in the third quarter of 2012, accounting for 42.2%. This was followed by the British Virgin Islands (BVI), with a share of 26.9%. Regarding external primary income outflow, the mainland of China and the BVI remained the most important destinations in the third quarter of 2012, accounting for 26.8% and 24.4% 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.

     Figures of GNI and EPIF analysed by income component from the fourth quarter of 2010 to the third 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 for 2012 are preliminary figures. They are subject to revision when more data become available. In the light of the latest information available, annual and quarterly figures on EPIF and GNI for 2011 have been revised.

     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, December 14, 2012
Issued at HKT 16:30

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