HONG KONG (Reuters] -Hong Kong saw its economy shrink by 4% over the year before, according to government data. The decline came after four quarters of recovery, when the city imposed strict measures to combat COVID-19.

The fourth quarter growth rate was 4.7%

Quarterly, the economy fell by 3.3% seasonally adjusted for January-March.

After considering the declining export outlook, the government lowered the forecast real gross domestic products for 2022 by 1% to 2.2%.

The government released a statement saying that “looking forward, the worsened world economic prospects might continue to weigh upon Hong Kong’s export performances.”

According to it, domestic economic activities need to show some recovery with the ease of COVID epidemic and gradual relaxation social distancing actions. A new round consumption vouchers could also be issued in order support domestic demand.

Meanwhile, Morgan Stanley According to the NYSE, Hong Kong is expected to grow 0.5% in its GDP by 2022. This will be due to the gradual recovery of the economy through the implementation of fewer social distancing policies and increased private consumption.