The Hong Kong Special Administrative Region (HKSAR) Government recently released the Half-Year Economic Report 2026 and revised Gross Domestic Product (GDP) figures for the second quarter of 2026. Ms. Vanessa Fan, Government Economist of the HKSAR, briefed the public on the economic performance in Q2 2026, alongside the latest full-year GDP and inflation forecasts for 2026.

Bolstered by buoyant external trade and resilient domestic demand, Hong Kong’s economy maintained robust expansion in the second quarter of 2026. Real GDP rose by 4.3% year-on-year in Q2, following a 5.9% growth in the first quarter. For the first six months of 2026, real GDP registered a 5.1% year-on-year increase, representing the strongest half-year growth recorded in the past five years.

Addressing the disparity between solid overall economic growth and uneven sentiment across sectors, Ms. Fan noted that all economic segments posted growth in Q2, albeit at varying paces.

For instance, goods exports surged 28.9% in the second quarter, accelerating from the 23.8% expansion in Q1 to a robust double-digit rise. On the investment front, private investment chalked up double-digit growth for three consecutive quarters, climbing from 14.6% in Q4 2025 and 10% in Q1 2026 to 19.4% in Q2. Private consumption grew for five straight quarters yet at a moderate pace, edging down from around 2.5% in Q2 2025 and 4.9% in Q1 2026 to 2.8% in the latest quarter.

“These divergent growth rates and sustained momentum explain the mixed sentiments across sectors,” Ms. Fan explained. “Two core themes have defined our economic performance over the past two quarters: technology and the global artificial intelligence (AI) boom. As a key trading hub for tech products, Hong Kong has reaped tangible benefits amid the worldwide surge in AI investment.”

Mainland China serves as both a major supplier and consumer market for advanced electronic goods. One-third of its integrated circuit exports are transshipped via Hong Kong, meaning AI-related products account for roughly 70% of Hong Kong’s merchandise export volume. Exports of such goods jumped by a strong 41.5% in Q1 and further accelerated to 63.7% in Q2.

Beyond merchandise exports, AI has also delivered significant economic gains through investment. Hong Kong acts as a vital financing platform for numerous technology and AI enterprises.

Data from the Hong Kong Stock Exchange (HKEX) shows that between December 2025 and May 2026, tech and AI-linked firms raised HK$97.9 billion through initial public offerings (IPOs) in Hong Kong, accounting for 55% of total IPO fundraising in the period — over half of all new listing proceeds came from the AI-tech industrial chain.

“External trade and investment remain vibrant, while consumption within domestic demand stays resilient,” Ms. Fan pointed out. “Consumer price inflation edged up slightly in the first half of the year but remained mild overall.”

Looking ahead, Ms. Fan projected that AI-driven demand and investment will stay exceptionally strong amid an enduring global AI upswing, set to propel Hong Kong’s economy in the second half via gains in merchandise trade and investment. While lingering impacts from elevated international oil prices will keep consumer inflation elevated in the coming months, price pressures in other segments will stay subdued, with overall inflation expected to remain moderate.