Bank of China (Hong Kong) predicated Friday that Hong Kong's economic growth rate would reach 5 percent in 2004, 1.8 percentage points higher than its final amended forecast figure for 2003.

Bank of China (Hong Kong) said in its research reports released Friday at a symposium on economic development trend that looking forward to 2004, Hong Kong will benefit from another round of global economic expansion and the implementation of the Chinese Mainland/Hong Kong Closer Economic Partnership Arrangement.

Hong Kong's economy, back into the rebound track, will speed upits growth and reduce the speed of deflation, the reports said.

Hong Kong's economy was hit hard by SARS and was influenced by the uncertainties caused by the war in Iraq in the first half of this year. Stimulated by the signing of CEPA and speedy recovery of the world economy, Hong Kong's economy has been witnessing a rapid rebound.

The reports indicated that Hong Kong will maintain its export growth next year, with increased export of financial service and tourism-related services.

As for domestic demand, the consumption and investment demands are expected to rise next year. Though unemployment will still be a headache for Hong Kong, the unemployment rate may fall to 6 percent in 2004, the reports said.

Concerning the stocks market in 2004, the blue chip Hang Sang index is expected to rise 10 percent to 15 percent, reaching 14,000 at the end of next year, after about 30 percent increasing this year.

However, financial experts warns against large movement of the index.

The research reports believed that Hong Kong's property market will witness a steady growth with narrow margin of rebound next year.

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