September 09, 2010
About Us | Links  | Help  | Feedback  | Briefcase  | Site Map
 Search

Tradeing Opportunities
Indian & International Tenders
Business Match-
making
Trade Inquiries

Home > Overseas Market Situation > Hong Kong
India Trade Promotion Organisation
ECONOMIC AND COMMERCIAL REPORT
Latest Developments
Hong Kong's economy has slowly recovered from the setback brought about by the global slowdown. Its GDP grew modestly by 2.3% in real terms in 2002 as against merely 0.6% a year earlier. Hong Kong's recent economic performance was upset by SARS fallout. In the second quarter of 2003, real GDP dropped by 0.5%, down from an increase of 4.5% in the f1rSt quarter. The outlook for 2003 is for a further modest pick-up in GDP growth, forecast at 3% by the government. However, with signs of improvement particularly with the lifting of WHO's travel advisories and stabilization of SARS, it has been revised to 2%, up from 1.50% Although the local interest rates have eased 12 times since 2001, conditions remained depressed in the asset markets. The best lending rate quoted by the Hong Kong and Shanghai Banking Corporation Limited, the market leader, is currently set at 5%p.a
Budget and Government Initiatives
The Mainland China and Hong Kong Closer Economic Partnership Arrangement (CEP A) was concluded in June 2003. Under CEP A and subject to certain country-of-origin requirement, products of Hong Kong will enjoy duty-free access to the Mainland China by 1 January 2006. The first stage of liberalization package of goods will be implemented by 1 January 2004. The six Annexes to the main text of CEP A was signed in September 2003 providing the implementation details. In his Policy Address delivered in January 2003, Mr. C. H. Tung, Chief Executive of Hong Kong, outlined initiatives setting the direction for Hong Kong's future development and measures to eliminate the fiscal deficit. He emphasized that the main pillars of Hong Kong economy -financial services, logistics, tourism and producer services should be reinforced and enhanced. Specifically, Hong Kong should elevate from its traditional role as an intermediary to become a major hub connecting China and the international market, and meanwhile, its position as the financial and commercial centre of China should further strengthened. The Chief Executive also suggested ways to further strengthen Hong Kong's economic tie With the Pearl River Delta (PRD), including pushing ahead with infrastructure projects to enhance their linkage. The Government reported a fiscal deficit of HK$ 6.7 billion or 4.9% of the GDP for the year 2003/2004. In the Budget for 2003/04 delivered in March 2003, the Financial Secretary unveiled a three-year plan to turn the deficit to surplus by restraining fiscal spending and raising taxes. The policy direction of strengthening Hong Kong as an international financial and high-value-added services centre remains in place.
Latest Trade Performance and Issues
Hong Kong’s total exports rebounded by 5.4% in 2002, as compared with a decline of 5.8% a year earlier. The recovery was distinctly noticeable over the course of the year, as the external demand steadily picked up from the repercussions of the bursting of the dotcomT bubble and the terrorist attacks of September 11, 2001. After a fall of 6.2% in the first quarter of 2002, export performance returned to growth from the second quarter and onward, with a robust growth of 12% in the latter half. In the first eight months of 2003, total expol1s further grew by 12.6% from the same period a year earlier comprising a robust expansion of re-exports. Within the total exports, Hong Kong's domestic exports nevertheless fell by 14.7% in 2002 amid acceleration in relocation of Hong Kong production to the Chinese mainland. On the other hand, driven by the fast-growing intra-Asia trade of raw materials and semi-manufactures, re-exports increased by 7.7% in 2002, indicative of the central role of Hong Kong in sourcing and coordinating production in the region. Hong Kong's major export markets are the Chinese Mainland, the US, the EU and Japan. They respectively made up 43%, 18%, 13% and 5% of Hong Kong's total exports in the first seven months of 2003. During this period, total exports to the Chinese Mainland grew by 22.9% while those to the EU and Japan rose modestly by 15.4% and 15.2%. Total exports to US dropped by 1.4%. For 2002 as a whole, with a strong pick-up in re-exports, imports of Hong Kong grew by 3.3% after a 5.4% increase a year earlier, resulting in a trade deficit of US$ 7.6 billion, compared to a deficit of US$ 11.8 billion in the previous period. Imports further increased by 11.2% in the first eight months of 2003 due to expansion of re-exports. Hong Kong's sluggish macro-economic environment, however, will likely continue to drag down its retained imports, which account for around one-third of Hong Kong imports.
INDIA -HONG KONG TRADE
Overview
During January -August 2003, India was the 14th important trading partner of Hong Kong as compared to being the 17th trading partner in 2002. India-Hong Kong trade reached US$3044 million (+8.0%). Indian exports reached US$1914 million (+ 13.2 %). Of this, US$1068 million (+13.4%) worth of goods were re-exported to other countries via Hong Kong. Hong Kong exported US$1130 million (+27.1%) worth of goods to India. Hence, India has a positive trade balance ofUS$784mi11ion during January -August 2003.
Overview of India -Hong Kong trade
(US $ million)
  2000 2001 2002 Jan-August 2003
Value Value Growth Value Growth
India to Hong Kong
Export to Hong Kong 2,624 2290 -12.7% 2494 +8.9% 1914 +13.2%
Hong Kong to India
Domestic Exports 172 59 -65.5% 53 -11.5% 32 -7.6%
Re- Exports 1,122 1142 +1.8% 1388 +21.6% 1098 +28.5%
Total Exports to India 1,294 1202 -7.1% 1441 +19.9% 1130 +27.1%
Total Bilateral Trade 3,918 3491 -10.9% 3935 +12.7% 3044 +18.0%
Trade Balance for India +1,330 +1088   +1053   +784  
Indian Export to Hong Kong
During January -August 2003, India Export of US$1914 million (+13.2%) worth of products to Hong Kong. Indian export of Pearls, precious, semi-precious stones (+18.3%) followed by leather (US$ 119) million (+13.6%), textiles yarn [(US$ 43 million (-37.9%)], flat rolled products of alloy steel US$ 26 million (-4.9%)], jewellery [USS18 million ( -16.6%)].
Indian Exports to Hong Kong -Top 20 products
(US $ million)
Commodity
Value
Share
Growth
Pearls, Precious & Semi-Precious Stones
1481
77.4
+18.3
Leather
119
6.2
-13.6
Textile yarn
43
2.2
-37.9
Flat-rolled product of Alloy Steel
26
1.4
-14.9
Jewellery
18
0.9
-16.6
Other Plastics in Primary form
15
0.8
+2.0
Textile fabrics, Woven, other than
cotton/man-made fibres
13
0.7
+58.9
Synthetic organic colour
lakes/colouring matter/preparations
12
0.6
-8.8
Medicinal & pharmaceutical products,
other than medicaments
11
0.6
+16.8
Cotton fabrics, Woven
10
0.5
-3.0
Polymers of Styrene in Primary forms
9
0.5
-26.4
Made-up articles wholly or chiefly
of textile materials
9
0.5
+60.0
Plates, sheets, film, foil and Strip, of plastics
9
0.5
+67.7
Fish, Dried, salted or in brine, smoked fish,
flours, meals & pellets of fish
8
0.4
-15.6
Copper
8
0.4
-10.2
Women's or Girl's wear of textile
fabrics, not knitted
6
0.3
+43.9
Other articles of apparel of textile fabrics
6
0.3
-3.8
Electrical apparatus for electrical circuits
6
0.3
+66.7
Electrical Power machinery and parts
5
0.3
-11.2
Clothing accessories, of textile fabrics
5
0.3
-30.5
Indian Imports from Hong Kong
Hong Kong exported US$1130 million (+27.1%) worth of goods of India during January-August 2003. The important items of exports are pearls, precious and Semi-precious stones [US$454 million (+12.80%)]. telecommunication equipment & parts[US$282 million(+213.20%)]. semi-conductor, electronic valves & tubes, etc. [USS49 million (+8.9%)], computers [US$26 million (+10.5%)],], parts and accessories of office machines/computers(US$25 million(-18.2%)]. and silver & platinum USS25 million (-27.2%)
Indian Imports from Hong Kong -Top 20 products
(US $ million)
Commodity Value Share Growth
Pearls, precious & semi-precious stones 454 40.2 +12.8
Telecommunications equipment & parts 282 25.0 +213.2
Semi-conductors electronic valves & tubes etc. 49 4.3 +8.9
Computers 26 2.3 +10.5
Parts & Accessories of office machines/computers 25 2.2 -18.2
Silver & Platinum 25 2.2 -27.2
Miscellaneous manufactures articles 20 1.8 +11.0
Watches and clock. 16 1.4 -41.6
Cotton fabrics woven 15 1.4 +31.2
Electrical apparatus for electrical circuits 14 1.2 +92.0
Electrical machinery & Apparatus 11 1.0 +19.6
Tulles, lace, embroidery, ribbons, trimmings
and other small wares 		11 1.0 +12.1
Textile yarns 11 0.9 -16.6
Printed Matter 11 0.9 +10.4
Electric power machinery & Parts 9 0.8 +5.2
Textile and leather machinery & Parts 9 0.8 +122.0
Medicinal & Pharmaceutical products, other
than medicoments		 9 0.8 +190.8
Instruments & appliances for medical, surgical,
dental or veterinary purposes		 9 0.8 -36.0
Textile fabrics, woven, other than cotton/man-made fibres 8 0.7 -8.9
Articles of Plastics 7 0.6 +6.6
 
   

Copyright 2001 India Trade Promotion Organisation All Rights Reserved
Copying material from this Portal for circulation either by print or
electronic versions is strictly prohibited.
Terms of Use |  Disclaimer  |  Privacy Policy
Powered by Advent Infosoft Pvt. ltd.