Import and Export Price Changes
12. Although Hong Kong's terms of trade did not change significantly in the first nine months of 1973, this does not mean that the prices (unit values) of imports and domestic exports were relatively stable over this period; in fact, both import and export prices, overall, increased at an exceptionally rapid rate. In the case of imports, prices increased by 15% in the first nine months of 1973, and this compares with 4% in 1972 and 2% in 1971. The prices of all major categories of imported goods (food- stuffs, consumer goods, fuels, raw materials and capital goods) increased at a faster rate in the first nine months of 1973 than in 1972, but the rates of increase in 1973 were particularly rapid in the case of foodstuffs, consumer goods and fuels. Prices of domestic exports increased by 16% in the first nine months of 1973, and this compares with 7% in 1972 and 6% in 1971.
Table 7(a)
Imports of Raw Materials (a) Import Prices
13. The very rapid increase in the import prices of raw materials, of 15% in the first nine months of 1973 compared with 4% in 1972 and no change in 1971, was, in part, a reflection of the emergence of world shortages of materials in this period. But Hong Kong's largest single supplier of raw materials is Japan. In the first nine months of 1973, 28% by value of Hong Kong's raw material imports came from Japan. The effective revaluation of the yen, in terms of the Hong Kong dollar, in December 1971 had a significant impact on raw material import prices, and this was reinforced by the upward flotation of the yen in March 1973 and subsequently.
14. It will be seen from Table 7(a) that im- port prices increased more rapidly in the first nine months of 1973 than in 1972 over a wide range of materials, but, in the case of raw cotton, the import price declined in the first nine months of 1973 (by 12%).
Change in Unit Value Indexes of Imports of Raw Materials from All Countries by Commodity Groups, 1969/68–1973/72
All raw materials
Value of imports in 1973* (HK$ (% of million) total)
8,167 100.0 + 5.0
(%)
Change in import unit value index 1969/68 1970/69 1971/70 1972/71_1973/72*
(%) (%)
(%)
(%)
+ 2.9
0.0
+ 3.7
+15.3
Raw cotton
469
5.7 + 2.0
1.0
+11.9 + 8.0
-12.0
Cotton yarn and thread
405
5.0 + 6.0
+ 6.6
+1.8
+ 1.7
+33.3
Woven cotton fabrics
591
7.2 + 5.0
+ 2.9
+2.8
+ 7.2
+14.5
Wool and other animal hair
175
2.1 + 7.0
5.6
- 13.9
+23.0
+82.8
Yarn of wool and mixtures
185
2.3
Fabrics of wool and mixtures
72
0.9
Man-made fibres
115
1.4
1+ 1
2.0
6.1
6.5
+17.4 +42.7
+ 7.0
+
4.7
+ 6.9
+ 2.8
+27.3
6.0
7.4
Yarn of man-made fibres
466
Fabrics of man-made fibres
1,029
12.6
30
5.7
0.0
6.0
p
+ 4.0
―
1.0
-14.9
6.4
3.9
-
-
9.5
+11.9
5.7
+17.3
2.0
+11.5
Dyeing, tanning and colouring
materials
256
3.1 + 9.0
+12.8
0.8
+11.5
+18.8
Plastic moulding materials
464
5.7 + 2.0
+ 3.9
2.8
—
3.9
+19.4
Chemical elements and compounds
238
2.9
5.0
5.3
+ 2.0
-
1.0
+ 2.9
Iron and steel
465
5.7
+ 8.0
+20.4
8.5
0.8
+25.2
Base metals, excluding iron and
steel
205
2.5
+10.0
+10.0
-
9.1
6.4
+ 2.9
Paper and paperboard
392
4.8
+ 3.0
+ 6.8
+ 2.7
0.0
+ 8.0
Others
2,639
32.3
+ 9.0
+ 9.2
0.0
+ 5.9
+21.7
* first nine months.
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