Hong Kong’s economy remains on track to meet its annual growth target despite rising geopolitical tensions and the impact of conflict in the Middle East, the city’s finance chief has said, expressing confidence in the resilience of the financial hub.

Speaking on the economic outlook, Financial Secretary Paul Chan said authorities are closely monitoring global developments but do not expect the conflict to significantly derail Hong Kong’s growth trajectory.

The government has projected economic expansion of between two and three percent for the year, driven largely by services, tourism recovery and improving domestic demand.

Chan acknowledged that escalating tensions in the Middle East have contributed to volatility in energy prices and financial markets, factors that could influence global economic conditions.

However, he emphasized that Hong Kong’s diversified economy and strong financial system provide a solid foundation to manage external shocks.

Tourism and retail activity have continued to recover following earlier disruptions to global travel, helping to support consumption and service-sector activity across the city.

Officials say visitor arrivals have steadily increased, contributing to stronger spending in hospitality, transport and entertainment industries.

The government has also highlighted Hong Kong’s role as an international financial centre connecting mainland China with global markets.

Authorities believe continued cross-border financial cooperation and investment flows will provide important support for economic growth.

At the same time, policymakers remain cautious about potential risks from global uncertainty, including geopolitical tensions, interest rate trends and shifts in international trade patterns.

Chan said the government would maintain prudent fiscal management while introducing measures aimed at strengthening the city’s competitiveness.

Efforts to attract international investment, expand innovation industries and enhance financial services are among the strategies officials say will support Hong Kong’s longer-term economic prospects.

Despite the challenging global environment, the finance chief said the city’s economic fundamentals remain solid, adding that Hong Kong is well positioned to navigate external pressures while continuing its gradual economic recovery.