HKTDC Export Index shows falling export confidence in Q3

September 14, 2017

HONG KONG - While near-term confidence in major markets has declined among Hong Kong exporters, the outlook for quality, unique style products and services remains bright in ASEAN markets, according to new research conducted by the Hong Kong Trade Development Council (HKTDC).

“The HKTDC Export Index dropped to 46.2 in the third quarter of the year from a four-year high of 50.1 recorded in the preceding quarter,” HKTDC Director of Research Nicholas Kwan said.

“Local exporters have become slightly negative about prospects for Hong Kong’s export performance in the near term,” he added. “The Index was dragged down by the clothing, toys, jewellery and timepiece sectors.”

The HKTDC Export Index monitors the current export performance of Hong Kong traders and gauges their near-term prospects. Readings above and below 50 indicate positive and negative sentiment, respectively. The United States, the European Union, Japan and the Chinese mainland are markets covered by the Index.

HKTDC Principal Economist (Global Research), Daniel Poon, said the Chinese mainland “remained the most promising market, while the United States was the least encouraging”.

The mainland, Hong Kong’s largest trading partner, was the only market that stayed above the watershed 50 mark – with a reading of 51.5 in Q317, down from 51.9 in the preceding quarter. 

The European Union scored 49.5, followed by Japan with 48.6. The US posted a reading of 47, down from 48.1 in 2Q17 and 50.3 in 1Q17.

 “While exporters were once positive on the US, in the beginning of 2017, confidence in the market slid down over the course of the year,” Poon said.

The survey also indicated that the perceived impact of Brexit on Hong Kong’s export performance continues to fall. The new research found that 91% of respondents report “no impact” so far from the UK’s prospective withdrawal from the European Union.

The figure was 86% in 1Q17 and 83% in 3Q16. Only 8% of responding exporters in the latest survey anticipated a negative impact, down from 13% in 1Q17 and 17% in 3Q16.  www.hktdc.com   (ATI).