Information from the Statistics and Census Service (DSEC) indicated that, in the wake of the latest wave of the pandemic, Gross Domestic Product (GDP) declined by 39.3% year-on-year in real terms in the second quarter of 2022. (A year-on-year fall of 66.3% in GDP was recorded in the second quarter of 2020.) Number of visitor arrivals went down by 27.5% year-on-year in the second quarter of 2022 amid the pandemic, with that of overnight visitors decreasing by 47.0%. As a result, exports of services dipped by 48.6% year-on-year, of which exports of gaming services and exports of other tourism services tumbled by 69.6% and 41.4% respectively; besides, exports of goods dropped by 36.0%. Domestic demand shrank further by 12.2% year-on-year owing to a decline in gross fixed capital formation. Imports of goods and services reduced by 20.0% and 12.0% respectively. The implicit deflator of GDP, which measures the overall changes in prices, went down by 0.9% year-on-year.
Household final consumption expenditure in the domestic market and abroad dropped by 6.3% and 4.1% year-on-year respectively, as consumer sentiment was further dampened by the economic downturn and local economic activity was affected by the new confirmed cases of coronavirus infection in the territory in late June. The overall private consumption fell by 6.6% year-on-year.
Government final consumption expenditure shrank by 6.5% year-on-year, attributable to a reduction of 15.7% in net purchases of goods and services by the SAR Government.
Gross fixed capital formation decreased by 29.4% year-on-year, of which construction investment dropped by 41.4% while equipment investment grew by 17.5%. Public construction investment went down by 24.3%, ascribable to a fall in investment in public housing construction; however, equipment investment increased by 47.4%. As regards private investment, construction investment declined by 48.6% owing to reduced investment in casinos, whereas equipment investment showed an uplift of 15.4%.
With merchandise trade being impacted amid the pandemic, coupled with a fall in the total demand, imports and exports of goods reduced by 20.0% and 36.0% year-on-year respectively.