Hong Kong’s external trade continues to register strong growth fueled by the global economic recovery and vibrant regional trade flows, but economists caution that short-term fluctuations may cloud future prospects.
According to the Census and Statistics Department data on Tuesday, the value of Hong Kong’s total exports and imports of goods both recorded year-on-year increases, at 25.9 percent and 28.1 percent respectively in August.
In August, the value of exported goods increased 25.9 percent over the previous year to HK$433.7 billion ($55.7 billion) in the same period, after a year-on-year increase of 26.9 percent in July.
Concurrently, the value of imported goods increased 28.1 percent over a year earlier to HK$460 billion in the same period, after a year-on-year increase of 26.1 percent in the previous month.
Carie Li Ruofan, an economist at OCBC Wing Hang Bank, said that Hong Kong’s exports and imports may both grow by about 20 percent annually in 2021
A trade deficit of HK$26.3 billion, equivalent to 5.7 percent of the value of the imported goods, was recorded in August.
Exports to the Chinese mainland, the United States, the European Union, and many other Asian economies showed increases. For the first eight months of this year, total merchandise trade value amounted to HK$6.51 trillion, surpassing by 12.8 percent the high in the same period in 2018.
“Looking ahead, the global economic recovery and vibrant regional trade flows should continue to support Hong Kong’s export performance in the near term,” a government spokesman said. “Yet, the pandemic development is still casting uncertainties on the economic outlook. Other risk factors such as China-US relations and heightened geopolitical tensions also warrant attention.”
Carie Li Ruofan, an economist at OCBC Wing Hang Bank, said that Hong Kong’s exports and imports may both grow by about 20 percent annually in 2021.
“On a positive note, with the vaccination rate rising across the globe and the Chinese mainland’s Delta variant outbreaks showing signs of stabilization, the resumption of global manufacturing may boost demand for mainland intermediate goods and capital goods in the medium term,” Li said.
However, the city’s trade sector faces a bumpy road ahead, Li said, as outbreaks of the Delta variant across the world have caused supply and demand shocks in August, and trading activities may have softened slightly.
“The resumption of production and the shifting of consumption from goods to services in the developed countries may also weaken the demand for mainland end products. Adding on the waning low base effect, we expect the city’s exports and imports growth to slow down in the coming months,” Li warned.
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