Commenting on Hong Kong's latest economic situation on Friday, Mr Tang said given the robust and full recovery, forecast GDP growth for 2005 has been revised from 4.5%-5.5% to 7%.

He said the revision indicates the forecast growth for Q4 will slow to 6.2%, due to higher interest rates and energy costs, as well as other external uncertainties.

Mr Tang said he is optimistic on the economic outlook, but will remain vigilant on the global economic situation and that of neighbouring countries.

On an avian flu outbreak's possible impact on the local economy, Mr Tang said it remains the most unpredictable factor. But he stressed it would depend on the degree of seriousness and it is hard to make an objective estimate at this stage.

Noting there is strong demand for the Government to share the fruits of economic success with the public, Mr Tang said he cannot commit to a tax cut at this stage as there are still a lot of uncertainties, adding that a decision will be made before the next budget is announced.

Government Economist Kwok Kwok-chuen said the 8.2% GDP growth in Q3 follows 7.3% growth in the previous quarter.

Mr Kwok said the double-digit growth in total goods exports was marked by continued growth in the Mainland and EU markets, steady growth in the US market, and a boost in a number of East Asian markets, including Japan, Taiwan, South Korea and Malaysia.

Services exports grew 8.2% in Q3, buoyed by flourishing offshore trade and transportation services and growth in inbound tourism.

While trade-related services exports continued to benefit from the Mainland's strong trade flows, exports of finance, business and other services grew in tandem with the upturn in business activities. Exports of travel-related services also expanded, although the momentum was not as fast as in the past few quarters.

On a seasonally adjusted quarter-to-quarter comparison, service exports rose 5.7% in Q3, up from the 0.9% growth in the preceding quarter.