Hong Kong exports tipped to fall 4% in 2016, exporters gloomy

HONG KONG - The Hong Kong Trade Development Council’s Export Index for the second quarter of 2016, at 37.2, is little changed from the previous quarter. A reading below 50 indicates sluggish export performance over the short-term.

Despite early signs of stabilisation in the global economy, and with lacklustre export figures in the first half of this year, HKTDC Research projects Hong Kong exports in 2016 to shrink by 4% cent on-year, down from a previous forecast of zero growth.

Nicholas Kwan, HKTDC Director of Research, says Hong Kong’s export performance has so far been below expectations and total exports in the first four months fell 5.6% on-year.

But he says the global trade environment may stabilise in the medium term. “There are signs that the US economy is regaining momentum, the Chinese economy has found a firmer footing, while firmer oil prices are also giving some breathing space for commodity exporting countries,” he says.

“It can therefore be inferred that overall external demand is going to revive gradually and, in the medium term, the global trade environment should improve.”

Exporters’ confidence in the performance of major markets remained cautious. Among Hong Kong’s four major markets, the export index for Japan stood at 47.4, unchanged from 1Q16 and the highest reading among major markets, followed by the US (45.8) and the Chinese mainland (45.8). The index for the EU was 44.3.  www.hktdc.com.hk (ATI).