HK trade undergoes diversification; ASEAN becomes No.2 export market
Published: Mar 17, 2024 09:10 PM
A snapshot of Hong Kong Photo: VCG

A snapshot of Hong Kong Photo: VCG

The export markets of the Hong Kong Special Administrative Region (HKSAR) are undergoing a diversification process, with more focus shifting toward emerging markets amid a decrease in exports to traditional markets such as the US and Europe, Hong Kong Financial Secretary Paul Chan Mo-po said in a post on his blog over the weekend. 

He highlighted expanding trade ties with the Association of Southeast Asian Nations (ASEAN), whose share of exports by value reached 7.9 percent in 2023, compared with 6.1 percent in 2022, making it Hong Kong's second-largest export market after the Chinese mainland.

As the global trade landscape evolves, the city's exports to the US dropped from 18.6 percent of the total in 2003 to just 6.5 percent last year, while exports to the EU decreased from 10.5 percent to 6.6 percent in the same period, according to Chan. 

The changes in Hong Kong's trade structure reflect the changes of the global economic landscape and an adjustment in Hong Kong's role, Liang Haiming, an expert on the Hong Kong economy and chairman of the China Silk Road iValley Research Institute, told the Global Times on Sunday.

The prospects of Hong Kong's industrial and export development are promising, Liang said, while taking note of Hong Kong's unchanged status as an international financial and commercial hub, which will continue to attract multinational corporations.  

Hong Kong's active participation in regional cooperation also opens up more trade opportunities. By actively participating in the Belt and Road Initiative and trade cooperation with ASEAN member countries, Hong Kong explores broader markets and investment opportunities for local businesses, Liang stated.

Amid the rapid shifts in exports, Hong Kong's trade has seen a quick recovery, with exports in January seeing a year-on-year increase of 33.6 percent, the largest rise since February 2021, to HK$388.7 billion ($49.7 billion). Its imports grew by 21.7 percent, reaching HK$385.1 billion, according to the Census and Statistics Department of the HKSAR government.

"As global economies transform and the importance of services trade increases, Hong Kong is well-positioned to expand its share in the services sector, leveraging its strengths in finance, law, logistics and professional services." Liang said.

The city is ramping up efforts to create new economic growth opportunities. The 2024-2025 Hong Kong Budget proposed building the HKSAR into a multinational supply chain management center, offering one-stop services for supply chain management, trade finance, consulting and talent training.

The initiative also aims to attract Chinese mainland manufacturers to establish offshore trading regional headquarters in Hong Kong, taking advantage of the city's rich management experience and favorable market conditions, said Chan.

Hong Kong has been actively moving to attract foreign investment. On February 2, Invest Hong Kong, a department of the HKSAR government responsible for foreign direct investment, announced that in 2023, it assisted 382 companies from 45 economies to establish operations in Hong Kong, bringing in investment of HK$61.6 billion and creating more than 4,100 new jobs, news website reported.

Alpha Lau, director-general of Invest Hong Kong, was quoted as saying in the report that efforts will continue in exploring emerging markets in Southeast Asia and the Middle East.