The Hong Kong Export Index grew 9.3 points to 39.0 in January-March this year as border reopens, said the Hong Kong Trade Development Council (HKTDC) recently when releasing results of its quarterly survey.
The first-quarter export survey showed that almost all respondents (98%) reported positive impacts from the gradual resumption of normal cross-border travel since early January, especially from the more flexible and frequent business travel and cross-border engagements, the council noted.
More than one-third of the exporters (36.5%) would increase shipments through Hong Kong, after cross-boundary land cargo transport was normalised, driven primarily by end-user requests and a preference for storage, sub-packaging and processing to be done in the city, the council added.
In addition, more global buyers would visit trade fairs in Hong Kong during the peak sourcing season to replenish inventory and meet pent-up demand, said Irina Fan, HKTDC Director of Research said.
“All these developments are the pull factors for the city’s trade outlook, and we expect a gradual pick-up in the second half of 2023,” Fan noted. “Taking into account the external challenges and uncertainties, our export forecast for this year remains unchanged at a 5% growth year-on-year.”
Hong Kong Export Index highlights
- More than half the respondents (55.7%) expected production and operating costs to increase, mainly because of higher raw material, logistics and labour costs.
- Against this backdrop, local exporters have adopted a versatile approach. In addition to cash-flow management (39.9%, up 5.3 percentage points), more exporters have focused on e-commerce development (36.3%, up 7.5 percentage points), value-added service provision (31.6%, up 6.6 percentage points) and overseas market expansion (30.5%, up 7.5 percentage points) in the first quarter of 2023.
- Clothing is the most promising sector, which swings back to the expansionary territory (51.5, up 27.7 points) since the third quarter of 2011, followed by toys (47.9, up 19.0 points) and timepieces (47.5, up 10.7 points)
- Sub-indexes, including the Trade Value Index (48.0, up 8.8 points), Employment Index (47.6, up 7.3 points) and Offshore Trade Index (28.0, up 8.3 points), also moved up.
- The Procurement Index remained subdued at 28.4 (down 0.5 point), but momentum varied across sectors – clothing, jewellery and toys improved, while timepieces and electronics slightly declined.