City exports pick up 11.5% in Oct
Figures come as a bit of surprise to local economists
Hong Kong’s total exports rose 11.5 percent in October year-on-year, a strong rebound from the 3.0 percent decline in September, suggesting that the export sector is not doing as poorly as many have feared.
The city’s total exports registered double-digit growth again in October, to HK$305.7 billion from a year earlier, helped by a revival in demand from some key markets, particularly the mainland, the Census and Statistics Department reported on Thursday.
It came after a year-on-year decrease of 3.0 percent in exports the previous month – the first fall in nearly two years due to the slowdown in the developed economies.
Before the government’s release, seven economists in a Bloomberg survey forecast that Hong Kong exports would only gain 1 percent in October.
Total imports in October increased 10.9 percent to HK$328.8 billion year-on-year, leaving a trade deficit of more than HK$23.1 billion, the government data shows. It also outstripped a prediction of 3.1 percent growth of imports in the Bloomberg survey.
The rebound in exports was nearly across-the-board, with a distinct turnaround seen in exports to the mainland, a government spokesman said in the release, commenting on why exports resumed positive year-on-year growth last month in the city.
Shipments to the mainland, which account for more than half of external demand for Hong Kong goods, increased by 11.9 percent in October from a year earlier, compared with a 7.3 percent drop registered in September.
Exports to other Asian economies also grew vibrantly, 13.7 percent as a whole compared with the 2.9 percent decrease in September, with those to India up 30.8 percent and those to South Korea rising 20.6 percent in October from the corresponding month last year.
Trade with the US, EU and Japan also reverted to modest growth last month, with exports to the US up 2.0 percent and those to Germany rising 5.5 percent last month, compared with a 8.9 percent and 0.7 percent slide in September.
The spokesman noted that October’s positive reading should also be viewed in conjunction with the relatively low base of comparison a year earlier.
Looking ahead, he further commented that the external environment will continue to be clouded by the rapidly evolving euro-zone sovereign debt crisis and the fragile fundamentals of the advanced economies, and that Hong Kong’s near-term export prospects remain highly uncertain.
The outlook for Hong Kong’s economy in 2012 has been clouded by many uncertainties. As the economies in the US and Europe are expected to remain weak next year, it is hard to feel optimistic about the city’s exports and overall economic performance in the coming year, Financial Secretary John Tsang told legislators this week.
Hong Kong’s economy narrowly missed a technical recession in the third quarter, inching up 0.1 percent during the period. But the figures still pointed to an overall slowdown due to external volatility, and the export sector, in particular, is expected to remain gloomy for the rest of 2011 and will extend into the beginning of 2012, government economist Helen Chan said this month.
Donna Kwok, economist for Greater China from HSBC, shared a similar view. Although a rebound in mainland appetite for Hong Kong exports provided critical support for Thursday’s big upside surprise, Kwok believes the city is seeing further headwinds with the euro zone now moving into recession and US demand still tepid.
“For Hong Kong, although it escaped recession last quarter, another dip into recession remains on the table next year,” said Kwok.
“But provided the US avoids dipping back into recession, the mainland stays on course for a soft landing, and the European debt crisis does not spillover globally, Hong Kong should strike a better balance between growth and inflation,” she added.
litao@chinadailyhk.com
China Daily
(HK Edition 11/25/2011 page2)
http://www.chinadaily.com.cn/hkedition/2011-11/25/content_14159419.htm