Exporters gain confidence amid market recovery
Hong Kong exporters are regaining business confidence, as indicated by the latest export index released by the Hong Kong Trade Development Council, which shows respondents’ market expectations surpassing their current business sentiment.
Released on Tuesday, the HKTDC Export Confidence Index revealed an overall score of 47.4, which measures exporter sentiment for the upcoming quarter, exceeding the current performance reading of 39.6.
According to the report, 70 percent of the respondents anticipate a recovery in growth in their primary external markets, with the Chinese mainland and the United States seen as having the most promising outlooks.
The HKTDC created the index to gauge local traders’ outlook on nearterm export performance. For the index survey conducted in the first quarter, a total of 500 Hong Kong exporters from six major industry sectors — clothing, electronics, jewelry, machinery, timepieces, and toys — were interviewed.
A reading below 50 still indicates a pessimistic outlook.
The subindex closest to expansion territory was sales and new orders, which registered at 49.9 points, reflecting exporters’ improving confidence in business demand. The four other subindexes are trade value, cost, procurement and inventory.
The value of Hong Kong’s total exports fell by 0.8 percent year-onyear to HK$284.1 billion ($36.3 billion) in February.
While exports to the mainland and the US rose, those to the European Union declined. A mixed performance was observed in exports to major Asian markets.
The HKTDC had earlier forecast that Hong Kong’s exports would grow 4 to 6 percent this year.
Economic risks remain the top concern for most surveyed exporters, with 83.3 percent viewing a recession or a slowdown in their main overseas markets as the biggest challenge to business growth over the next 12 months. Additionally, 63 percent of the respondents expressed their concerns about rising transportation costs.
Irina Fan, director of research at HKTDC, said Hong Kong’s overall exports have been on an upward trend since September, driven by a recovery in the electronics sector.
Despite challenges posed by Hong Kong’s interest rate environment and the US Federal Reserve’s expected rate cuts, Fan said that exporters could still benefit from declining financing costs, with a weaker greenback enhancing the pricing competitiveness of the Hong Kong dollar.
Looking ahead, Cherry Young, a senior economist at HKTDC, said that growing demand from the mainland and e-commerce will provide key momentum for the city’s exports amid global economic headwinds.