Hong Kong recorded a balance of payments deficit of HK$136.5 billion in Q3

The Zhitong Finance App learned that the Statistics Department of the Hong Kong Government today released preliminary statistics on Hong Kong's balance of payments and international investment position for the third quarter of 2025, as well as preliminary statistics on Hong Kong's external debt for the same period. Hong Kong recorded a balance of payments deficit of HK$136.5 billion (equivalent to 16.0% of GDP) in the third quarter of 2025, while reserve assets were reduced by the same amount.

I. Balance of payments

Hong Kong recorded a balance of payments deficit of HK$136.5 billion (equivalent to 16.0% of GDP) in the third quarter of 2025, while reserve assets were reduced by the same amount. A surplus of HK$105.5 billion (equivalent to 13.4% of GDP) was recorded in the second quarter of 2025.

Current account

The current account recorded a surplus of HK$98.2 billion (equivalent to 11.5% of GDP) in the third quarter of 2025, reflecting that Hong Kong saved more than invested, allowing it to accumulate external financial assets (such as equity securities or debt securities) to cushion global financial fluctuations. Compared with the HK$113.2 billion current account surplus (equivalent to 13.9% of GDP) in the third quarter of 2024, the decrease in the surplus was mainly due to a decrease in initial net income inflows, while the increase in the surplus in trade in services offset the decline in part of the current account surplus.

Goods trade recorded a surplus of HK$1.5 billion in the third quarter of 2025, while a deficit of HK$600 million was recorded in the same quarter of 2024. Over the same period, the surplus on trade in services increased from HK$38.8 billion to HK$48.1 billion. Initial revenue inflows and outflows for the third quarter of 2025 were HK$576.1 billion and HK$521.5 billion respectively, resulting in net inflows of HK$54.5 billion, while net inflows of HK$80.3 billion were recorded in the same quarter of 2024.

financial account

Non-reserve financial assets recorded an overall increase of HK$271 billion (equivalent to 31.7% of GDP) in the third quarter of 2025, while an overall increase of HK$21.1 billion (equivalent to 2.7% of GDP) was recorded in the second quarter of 2025. The overall increase in the third quarter of 2025 was due to a net increase in other investments, securities investment, and financial derivatives, while a net decrease in direct investment offset part of the overall increase.

Reserve assets decreased by HK$136.5 billion in the third quarter of 2025 and increased by HK$105.5 billion in the second quarter of 2025.

II. International investment positions

At the end of the third quarter of 2025, Hong Kong's total external financial assets and liabilities were at a very high level, at HK$59586.8 billion (equivalent to 18.2 times GDP) and HK$39,936.9 billion (equivalent to 12.2 times GDP), respectively. This is a common characteristic of an important international financial center.

At the end of the third quarter of 2025, Hong Kong's net external financial assets (i.e. assets minus liabilities) reached HK$196499 billion (equivalent to 6.0 times GDP), while at the end of the second quarter of 2025, it was HK$18364.7 billion (equivalent to 5.7 times GDP). The ratio of Hong Kong's net external financial assets to gross domestic product is one of the largest in the world, providing a strong buffer for the Hong Kong economy in the face of sudden external shocks.

III. Foreign debt

At the end of the third quarter of 2025, Hong Kong's total external debt was HK$15746.1 billion (equivalent to 4.8 times GDP). Compared with HK$15463.6 billion (also equivalent to 4.8 times GDP) at the end of the second quarter of 2025, total external debt increased by HK$282.5 billion. This was mainly due to an increase in external debt from other sectors, while the increase in external debt in the banking sector, direct investment debt (intercompany loans), and the increase in external debt of the Hong Kong Monetary Authority also played a role.

As one of the world's major financial centers, Hong Kong has a large amount of foreign debt stemming from the local banking sector and generated through daily banking operations. At the end of the third quarter of 2025, the banking sector's external debt accounted for 52.3% of the total. Other external liabilities mainly include foreign debt from other sectors (29.9%) and direct investment debt (intercompany loans) (16.5%).