Hong Kong's economy shrinks in 2nd quarter: official

Hong Kong's economy shrank 0.1 percent in the second quarter due to weak exports amid slowing growth in the global economy, the government said Friday. The contraction in the second quarter was worse than the median forecast of 0.1 percent growth by five economists in a Dow Jones Newswires survey. "On a seasonally adjusted quarter-to-quarter comparison, real GDP dipped marginally by 0.1 percent in the second quarter, following 0.6 percent growth in the first quarter," an official statement said. Compared with the same period last year, gross domestic product expanded 1.1 percent, helped by a lower base of comparison a year earlier when a massive earthquake and tsunami in Japan disrupted the country's export industry. The government revised its 2012 full-year GDP growth forecast to 1-2 percent from 1-3 percent previously. "The negative spillovers from the sluggishness of the advanced economies to Asia have... turned increasingly visible," it said. "Amid mounting headwinds to the global economy, the external environment would thus remain difficult and continue to overshadow Hong Kong's export outlook in the near term." It said Asian economies including China generally had "sounder fundamentals" and room to ease policy controls to stimulate growth.