LI, Tao @ Hong Kong

But economists note signs of slower growth

Hong Kong’s total exports rose 16.6 percent in November from a year ago, supported by strong demand from regional markets. However, economists noted signs of a slowdown as indicated by the seasonally adjusted three-month figures.

According to figures released by the Census and Statistics Department Tuesday, Hong Kong exports rose 16.6 percent to HK$273.0 billion last month from HK$224.8 billion a year earlier, compared with a year-on-year increase of 13.9 percent in October.

Total imports increased 16.4 percent year-on-year to HK$296.6 billion, leaving a visible trade deficit of HK$23.5 billion.

Exports held up well in November, continuing to show significant year-on-year growth despite the higher base of comparison in the same period last year, a government spokesman said in a statement. This largely reflected strong demand in regional markets, he added.

Total exports to the rest of Asia grew by 17.8 percent in November compared with the same period last year. Increases were noted in most major destinations within the region, in particular the 43.9 percent rise in the city’s exports to Vietnam.

Meanwhile the mainland saw an 18.6 percent rise to HK$142 billion, while Thailand and Malaysia saw increases of 23.2 percent and 20.4 percent respectively.

Although the sustained growth of Asian economies is likely to render continued support to the city’s exports, the spokesman said that the fragile fundamentals of the advanced economies remain a concern.

And the slowdown has been reflected in the seasonally adjusted figures, which decreased by 3.5 percent for the three months ended November compared with the previous three months – the first negative record since October 2009.

“The seasonally adjusted figures for Hong Kong exports have decreased all the way down from the previous peak of 10.9 percent in April, as major economies – especially European countries – have seen no sign of resuscitation,” said Irina Fan, senior economist at Hang Seng Bank.

Although exports to the US have increased 14.9 percent last month, decreases have been registered to several major destinations in Europe, including the UK, Germany and the Netherlands, which were down 8.6 percent, 0.9 percent and 0.5 percent respectively in November.

Fan said that though the unemployment rate in the US remains high, the second round of quantitative easing as well as the tax cut deal initiated by the US government are nevertheless positive news for the city’s exports as the measures will certainly boost domestic demand.

However, as a majority of European countries have announced that they are to cut their government budgets and reduce spending in 2011, Hang Seng’s Fan expects the city’s exports to the euro zone to continue to decline next year.

For the first 11 months in 2010, as a whole, the city’s total exports have risen 23.8 percent over the same period in 2009. Though a slowdown is inevitable, Fan said the bank still predicts that Hong Kong’s exports will see another year of double-digit growth in 2011 – most likely 11 percent.

China Daily

(HK Edition 12/29/2010 page3)

http://www.chinadaily.com.cn/hkedition/2010-12/29/content_11767832.htm