HONG KONG (REUTERS) - Hong Kong's economy is expected to grow between 2 to 3 per cent in 2017, helped by stronger factors at home and in the global economy that will likely help its exports, the city's financial secretary Paul Chan said on Wednesday (Feb 22).

The pick-up in growth projections for 2017 paints a relatively brighter picture for the former British colony which has been grappling with weak domestic retail sales and tourism, as well as a struggling financial sector.

A median estimate of a Reuters survey of six economists expected annual growth of 1.3 per cent in 2017.

"Sustained increases in infrastructure and other building and construction activities should provide momentum for domestic demand," Chan said in his first budget speech. "The slightly improved global economy over the recent period will lend support to Hong Kong's export performance."

The economy grew 1.9 per cent in 2016, near the top end of the government's forecast range of 1-2 per cent and beating economists' forecasts of 1.5 per cent.

The December quarter logged 3.1 per cent growth from a year earlier, its strongest pace since the June quarter of 2015 and benefitting from improved economic activity in mainland China, economists said. A Reuters poll forecast growth of 1.6 per cent.

China posted much stronger-than-expected trade data for January fuelled by demand at home and abroad, even as Asia braced for a rise in US protectionism under President Donald Trump.

"While the government is forecasting stronger growth this year, the wild card will be protectionist trade policies by Trump towards China and that will be a key challenge for the new chief executive," said Raymond Yeung, chief economist for Greater China at ANZ.

Meanwhile, Hong Kong's tourism sector is also looking up, with activity picking up in December and again in January, although analysts say it is too early to call for a recovery yet as store closures and lay-offs continue.