HONG KONG, 5 MAY 2011 - The Internet rolled in HK$96 billion or 5.9 percent of GDP in Hong Kong in 2009, said Boston Consulting Group Wednesday when releasing its report titled "The Connected Harbour: How the Internet is Transforming Hong Kong's Economy,"
According to the advisory firm, the Internet's GDP contribution is likely to grow by 7 percent annually-- contributing 7.2 percent of GDP in 2015-- faster than the forecasted GDP growth of 4 percent, reaching HK$146 billion by the same year.
The report is the first in Hong Kong and in Asia to identify the size and growth of the Internet economy, said BCG, adding that it researched and wrote the independently the Google - commissioned report.
The value of the Internet economy was estimated using the expenditure approach to GDP measurement, said BCB, adding that the approach measures total spending on finished goods and services, covering covers four key elements: consumption (both goods sold online and the costs of getting online), investment, government spending, and net exports.
Roughly a third of Hong Kong's Internet economy is driven by consumption, evenly divided between spending on online shopping and consumer spending on access to the Internet, including telecom services, hardware and software, BCG noted.
Another third comes from net exports of e-commerce and Internet-related hardware, reflecting Hong Kong's role as a global trading hub while the rest consists of government and private investment in Internet-related goods and services, such as hardware, software and network maintenance service. The advisory company added.
Small biz grows online
As part of its research, BCG also surveyed over 500 small and medium enterprises. These companies account for 50 percent of Hong Kong's economy. "The survey reveals that three-quarters of SMBs in the trade, transport and logistics, and technology sectors actively use the Internet," said David Dean, global leader -- technology, media and telecommunication practice, The Boston Consulting Group. "About four in five of these businesses who actively use the Internet report higher sales and three in four report lower costs as a result of the Internet."
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