Hong Kong September exports up 8.5 pct yr-on-yr vs 7.5 pct rise in Aug

Hong Kong September exports up 8.5 pct yr-on-yr vs 7.5 pct rise in Aug - UPDATE

	Published : Thu, 25 Oct 2007 11:51 By : Agencies Print this Story

HONG KONG (Thomson Financial) - Hong Kong exports by value rose at a faster pace in September as strong growth in shipments to China and other Asian and European destinations offset a slack in exports to the US and Japan.

Exports rose 8.5 percent in September from a year ago to 238.7 billion Hong Kong dollars, faster than Augusts's 7.5 percent growth rate, and in line with market consensus.

'The demand from China and from other parts of Asia and Europe made up for the slack in exports to the US,' said Frances Cheung, economist with Standard Chartered.

'The cooling of the economy explains weak demand from the US,' she said.

Shipments to the US, the second-largest buyer of Hong Kong goods, fell 2 percent year-on-year to 34.7 billion dollars, according to data released by the government Thursday. The US accounts for nearly 15 percent of Hong Kong's total exports.

Exports to China, the biggest market, rose to 117.3 billion dollars, up 13.4 percent from a year earlier. China's buoyant economy is raising demand for Hong Kong products, accounting for 49 percent of Hong Kong's total exports.

Sales to Japan, the third-largest buyer, declined 7 percent from a year ago to 9.9 billion dollars.

'I think this is the trend now for many northeast Asian countries. Europe and Asia are providing a boost to trade, more than the US (does),' said Cheung.

Cheung had expected exports in September to grow by 9.4 percent.

Re-exports, or imported goods reprocessed and exported from Hong Kong, grew 9.4 percent to 228.9 billion dollars , while domestic exports fell 10.3 percent to 9.8 billion dollars, the government said.

September imports expanded 9.3 percent over last year to 253.5 billion dollars.

The trade deficit for the month was 14.8 billion dollars, or 5.8 percent of the value of imports during the period.

'The vibrant mainland market remained the key growth driver for Hong Kong's exports,' a government spokesman said.

'Emerging markets in Asia also fared strongly, while exports to the European Union market saw further expansion. All these helped to offset the continued softness in the US market,' he said.

Within the Asian region, exports to India grew 42.9 percent. Indonesia was another major contributor to Hong Kong export growth, registering a 31.6 percent rise, while exports to Malaysia were up 19.3 percent and exports to Thailand were up 11.1 percent.

In Europe, exports to Germany, Hong Kong's fourth-largest market, were up 17 percent and Netherlands 10.1 percent.

By category, exports of electrical machinery, apparatus and appliances climbed 11.7 percent, while those of telecommunications and sound recording equipment rose 16 percent.

Despite notable growth in September exports, the government said the 'external trading environment has turned more uncertain following the recent global credit market turbulence.'

'The weakness of the US market is likely to continue in the coming quarters, in light of its protracted housing market correction and subprime mortgage problems,' the spokesman said.

Standard Chartered's Cheung expects export growth to remain robust, growing at high single digits in the fourth quarter, despite a slowdown in the US economy.

'We are still looking at a 7 to 9 percent growth going forward. Basically that should be supported by robust demand from Europe and Asia,' she said.

'The strong China economy is also a key factor,' she said.

China's gross domestic product expanded 11.5 percent in the third quarter from a year earlier, after an 11.9 pct expansion in the second quarter. The Asian Development Bank forecasts full-year growth of 11.2 percent.

(1 US dollar = 7.80 Hong Kong dollars)

leonora.walet@thomson.com

lw/zr

The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.

Hong Kong September exports up 8.5 pct yr-on-yr vs 7.5 pct rise in Aug - UPDATE