TDC slashes HK export growth forecast to 2pc due to US-China trade war
THE Hong Kong government's trade-promotion body, the Trade Development Council (TDC) has revised downwards its forecast for the city's export growth to 2 per cent this year, compared to an earlier forecast of 5 per cent growth mainly due to the escalating US-China trade war
THE Hong Kong government's trade-promotion body, the Trade Development Council (TDC) has revised downwards its forecast for the city's export growth to 2 per cent this year, compared to an earlier forecast of 5 per cent growth mainly due to the escalating US-China trade war.
US President Donald Trump said last week he would decide in early July whether to impose 25 per cent tariffs on US$300 billion of untaxed Chinese imports after his expected meeting with President Xi Jinping at the G20 leaders' summit in Japan at the end of June.
Risks of a prolonged tariff exchange, as well as wider political uncertainty, had severely lessened the momentum of Hong Kong's export growth, according to Nicholas Kwan Ka-ming, the council's director of research, reports Hong Kong's South China Morning Post.
Growth of 2 per cent would be the slowest since 2016, he noted, and mark a severe come down from last year's rate, which at 7.3 per cent was among the fastest in almost a decade.
'We have so far seen exports to our core markets the US and Japan doing badly,' he said. But he added 'even two per cent growth is not too bad because Hong Kong's exports did very well last year'.
He noted other sources of political uncertainty, including Britain's planned departure from the EU and the rise of populism in Italy, and the trade war's knock-on effects.
'The trade war not only causes a lose-lose situation between the US and mainland China, but also rippling effects to jurisdictions connected through the intricate supply chain,' he said.
Hong Kong has been hard hit by the US-China trade war with imports and exports continuing to slide in April. Exports fell for the sixth month in a row, down 2.6 per cent year on year, while imports fared even worse, down 5.5 per cent on last April.
More trouble is expected in the coming months as the headwinds of the trade war continue to buffet the city's economy, reports Hong Kong's South China Morning post.