Mar 17, 2020 - The confidence level of Hong Kong's exporters has fallen to its lowest-ever level in the face of a triple challenge - the COVID-19 outbreak, softening global demand and lingering trade tension between the United States and Mainland China. The Hong Kong Trade Development Council (HKTDC) announced the latest HKTDC Export Index today with a reading of 16 - down a further 2.8 points from the previous quarter's low - indicating that local exporters have become more pessimistic about the city's short-term export outlook across all industries and markets, especially jewellery.
Close to 94% of the 500 Hong Kong exporters surveyed said the COVID-19 outbreak has adversely affected their companies in areas such as arranging product deliveries (80.4%), supply of labour following the Chinese New Year holiday (76.2%), business contacts with overseas buyers or suppliers (60.5%) and supply of raw materials (56.1%).
HKTDC Director of Research Nicholas Kwan said the COVID-19 pandemic has disrupted the global supply chain, leaving entire markets in a state of uncertainty, and may accelerate its transformation. "Since the Sino-US trade dispute surfaced, many manufacturers have set up production lines outside the mainland to avoid additional tariffs. Following the COVID-19 outbreak, operations in some factories in the mainland - and even in Japan and Korea - have been suspended or have yet to fully resume, putting a strain on the global supply chain. For example, the shortage of electronics components has affected the supply of consumer electronics in the market. Multinational corporations may begin to further diversify their investments and no longer rely on a single country for production."
Mr Kwan added that the pandemic has resulted in the global economy losing its growth momentum, leading to a decline in the demand for new orders. "Economic and business activity has been on the wane worldwide during the outbreak. A total of 15 of the HKTDC's locally held trade fairs and conferences have been postponed. However, industry players can make good use of the HKTDC's digital platform for promotion purposes, and access government funding programmes to enhance their competitiveness and diversify production and markets."
References
- HKTDC Research website: research.hktdc.com/tc
- HKTDC Export Index 1Q20 - Exporter Confidence Repeatedly Hit Record-Low amid the Novel Coronavirus Outbreak bit.ly/2Q4UNaT
- Northern Vietnam: A Magnet for Foreign Investment bit.ly/2IEaxh1
- The Mainland Cities of the Greater Bay Area (1): Consumer Characteristics and Wealth Management Arrangements bit.ly/2vQWDpg
- Photo Download: bit.ly/2xClSMj
About HKTDC
The Hong Kong Trade Development Council (HKTDC) is a statutory body established in 1966 to promote, assist and develop Hong Kong's trade. With 50 offices globally, including 13 in Mainland China, the HKTDC promotes Hong Kong as a two-way global investment and business hub. The HKTDC organises international exhibitions, conferences and business missions to create business opportunities for companies, particularly small and medium-sized enterprises (SMEs), in the mainland and international markets. The HKTDC also provides up-to-date market insights and product information via trade publications, research reports and digital news channels. For more information, please visit: www.hktdc.com/aboutus. Follow us on Twitter @hktdc and LinkedIn.
Contact:
Beatrice Lam, Tel: +852 2584 4049, Email: beatrice.hy.lam@hktdc.org
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