HONG KONG (Reuters) - Hong Kong's recession-hit economy probably shrank 5.2 percent in the first quarter, its worst quarter since early 1999 after the Asian financial crisis, as plummeting exports and rising unemployment hit consumer spending and investment, a Reuters poll shows.

On a quarterly basis, GDP most likely declined for a fourth straight quarter, marking the longest contraction since 2001 after the dotcom bubble burst and tracking trends in regional neighbours Japan, Singapore and New Zealand.

Economists did not give precise forecasts for the quarterly change in gross domestic product but said it probably fell between 1.5 and 1.8 percent from the previous three months, slightly lagging a 2 percent seasonally adjusted decrease in the fourth quarter.

That may suggest the economy is bottoming out, although economists said it is too soon to confirm the worst is over.

"The risk is very much on the downside," said Eric Tsang, an analyst at Calyon. "The U.S. and other major markets have been showing slight signs of economic deceleration, but we can't say conclusively that the global economy has reached bottom."

The GDP data, meanwhile, will not fully reflect the downturn in the trade sector. Net exports probably actually rose slightly in the first quarter because imports fell by more than exports.

However, imports, like exports, are predominantly re-exports with mainland China and trade volumes in the first quarter slumped more than 20 percent from a year ago.

China said on Wednesday that its industrial output rose less than expected last month, a day after reporting a bigger than expected decline in April exports, offering another reminder that the global economic recovery may not be as swift or as strong as financial markets had hoped for.

As a trade and financial hub, Hong Kong's economy is strong tied to China's and highly exposed to the global economic cycle. Thus, it is not likely to recover before the U.S. economy picks up, analysts say.

The government and economists forecast GDP will shrink 3 percent this year, its first full-year contraction since 1998 at the height of the Asian financial crisis.

As trade and finance have been hit hard in recent months, unemployment has shot up to 5.2 percent from 3.2 percent last summer, further depressing consumer spending and confidence.

The government has announced some measures to support the economy, including easier access to credit for businesses and more temporary tax cuts and waivers on utility bills, and it has brought forward infrastructure projects to create jobs.

It is expected to announce further stimulus measures in the next few months, which Kevin Lai, senior economist at Daiwa Institute of Research, says is urgently needed.

"The government is clearly not acting enough to help counteract this recession," said Lai.

"It should step up temporary tax cuts, increase welfare payments and introduce consumption coupons like Taiwan has done. At least then you push people to go to the shops, that's key."

The government can afford to spend more after announcing a surprise fiscal surplus for 2008/09, bucking forecasts for a hefty deficit.

Tentative signs that China's economy is picking up after slowing sharply in recent months could help increase tourism from China to Hong Kong in coming months.

In another boost, Beijing has just further relaxed restrictions on travel to Hong Kong. What Hong Kong really needs though is a rebound in China's exports to kick-start its role as a re-export centre, analysts say.