Chapter 2
Overseas Trade
(In this chapter, for convenience, where rates of change for a particular period are mentioned, these relate to the rates of change between that period and the corresponding period of the previous year)
Introduction
9. Hong Kong's crucial dependence on overseas trade can be illustrated by the fact that merchandise imports and exports together are equivalent, in constant price terms, to some 180-200% of the gross domestic product. Table 5 shows the value of Hong Kong's merchandise
Table 5
trade with the rest of the world for the years 1969 to 1972 and for the first nine months of the years 1971 to 1973*. Domestic exports in- creased by 22% in the first nine months of 1973 compared with 11% in both 1972 and 1971. Re-exports increased at an even faster rate in each of these periods: by 18% in 1971, 22% in 1972 and 52% in the first nine months of 1973.
Merchandise Trade, 1969-1973
(HK$ million)
1969
Domestic exports
10,518
Twelve months:
1970
1971
12,347 13,750
First nine months:
1972
1971
1972
1973
15,245
10,187
11,201
13,680
Re-exports
2,679
2,892
3,414
4,154
2,447
2,954
4,503
Total exports
13,197
15,239
17,164
19,399
12,634
14,155
18,183
Imports
14,893
17,607
20,256
21,764
14,994
15,968 19,896
Trade deficit
1,696
2,368
3,092
2,365
2,360
1,813
1,713
10. Total exports in 1971 increased at a slower rate (13%) than imports (15%) and, consequently, the merchandise trade deficit widened; but, in 1972, with total exports in- creasing by 13% and imports increasing by 7% it narrowed. The trade deficit for the first nine months of 1973 was marginally narrower than that for the first nine months of the previous year; the rate of growth of total exports was 28% in this period compared with 25% for imports.
Terms of Trade
11. Hong Kong's terms of trade improved over the period 1969 to 1973. Table 6 shows, however, that the improvement in the first nine months of 1973 was rather small.
Table 6
Terms of Trade, 1969-1973
(1968=100)
Unit value indexes
Domestic
Terms of
Imports
trade index
exports
1969
107
106
101
1970
115
110
105
1971
122
112
109
1972
130
116
112
1973†
149
132
113
† first nine months.
* A full analysis of the overseas trade statistics for the fourth quarter of 1973 was not available at the time this publication went to print and consequently the discussion in this chapter is not taken further than
September 1973. The value of Hong Kong's trade in 1973 (percentage increase on 1972 shown in brackets) was:
4
domestic exports, HK$19,475 million (28%);
re-exports, HK$6,525 million (57%);
imports, HK$29,005 million (33%).