Hong Kong's export growth on the mend

It jumped to 3.4% in March.

According to DBS, March export growth increased to 3.4% from -1.3% in February, the first increase in four months. Meanwhile, import growth fell to 3.2% in March from 6.8% in February, resulting in a monthly merchandise trade deficit of HKD 50.4 billion.

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Contrary to popular views that developed markets would provide key support to external trade, exports to developing markets have been outperforming hitherto. Exports to ASEAN have been the best performer and have grown by 4.3% YTD. Exports to Asia ex-China & Japan have also fared well at 3.7% YTD.

On the other hand, export growth to the EU and US markets have been relatively modest at 2.6% and 2.3% YTD respectively, and exports to Japan fell by 0.5% YTD.

Looking ahead, as the US shakes off weather woes and the EU recovery finds a firmer footing, developed countries should begin to contribute more to bolstering Hong Kong’s export growth starting from 2Q14.