HONG KONG: Hong Kong stocks sank more than four percent Wednesday on worries about China’s economy after data showed it grew in 2023 at its slowest pace for more than three decades outside the pandemic years.

The Hang Seng Index fell 4.11 percent, or 652.69 points, to 15,213.23.

The Shanghai Composite Index closed down 2.09 percent, or 60.37 points, at 2,833.62, and the Shenzhen Composite Index on China’s second exchange dived 2.54 percent, or 44.33 points, to 1,698.70.

The losses were reflected across Asia, with sentiment also hammered by concerns that a string of hoped-for US interest rate cuts might not start until later in the year, and not be as extensive as initially expected.

China’s National Bureau of Statistics revealed that gross domestic product expanded 5.2 percent to hit 126 trillion yuan ($17.6 trillion) last year.

The reading is better than the three percent recorded in 2022, when strict zero-Covid curbs destroyed activity, but marks the weakest performance since 1990, outside of the pandemic years.

After lifting its draconian Covid measures at the end of 2022, Beijing set itself a growth target of “around five percent” for last year.

Hong Kong stocks open with small gain

The economy enjoyed an initial post-pandemic rebound, but ran out of steam within months as a lack of confidence among households and businesses hit consumption.

And statistics last month showed deflation continued for the third month in a row, likely deepening consumer reluctance to spend.

Tensions with the United States and efforts by some Western nations to reduce dependence on China or diversify their supply chains have also hit growth.