3
The Economy
economy slipped back to recession amid the euro debt crisis. Reflecting the weak demand there, exports to the EU contracted at a double-digit rate in 2012. Exports to the US and Japan, where recoveries were fragile and uneven, were also subdued. The sluggishness of the advanced economies inflicted visible negative spillovers to the Asian economies in 2012, many of which saw a slowdown in their production and export activities. As such, Hong Kong's exports to such Asian markets as India, Korea, Singapore and Taiwan declined visibly in 2012. In the case of exports to the Mainland, there was nonetheless a visible improvement in the latter part of 2012, along with the rebound of economic growth there, leading to a modest increase for the year as a whole. In terms of the quarterly profile, total exports of goods contracted by 5.2 per cent and 0.2 per cent respectively in the first and second quarters over a year earlier, before bouncing up to grow by 4 per cent and 6.1 per cent respectively in the third and fourth quarters (Chart 8). On a seasonally adjusted quarter-to-quarter comparison, goods exports grew mildly in the first quarter, then fell back in the second quarter, before picking up strongly in the third and fourth quarters.
Chart 8
Hong Kong's Visible Trade
(year-on-year rate of change in volume terms)
35
555
30
25
20
15
10
5
0
-5
-10
-15
-20
-25
Per cent
Imports
of goods
Total exports of goods
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2008
2009 1 2010
2011
2012
Merchandise exports remained sluggish in 2012 amid tepid demand in the advanced economies, but picked up towards the year-end on faster Mainland growth.
Imports of goods grew mildly by 1 per cent in volume terms in 2012. The slowdown from the moderate growth of 4.1 per cent in 2011 mainly reflected the fall-off in import intake related to re- exports. Retained imports, which accounted for more than a quarter of total imports, nevertheless grew moderately by 3.5 per cent in volume terms in 2012, though also slower than the 7.8 per cent growth in 2011. Analysed by end-use category, retained imports of consumer goods maintained solid growth of 6.4 per cent even against 2011's distinctly high base, thanks to the resilient consumption market. Those of capital goods accelerated further, reflecting the relatively sanguine local business sentiment during most of the year. Retained imports of foodstuffs posted mild growth, but retained imports of raw materials dropped for the second consecutive year, alongside the general economic slowdown. Retained imports of fuels also fell for another year, probably due partly to the slower transport activity and partly to continued energy-saving efforts.
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