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Josephine Ma

HONG Kong's role as the largest jewellery exporter in Asia has been overtaken by Thailand, with its cheaper raw materials and labour, according to the Trade Development Council (TDC).

  A member of TDC's Jewellery Advisory Committee, Karl Shin, said Thailand had overtaken Hong Kong as the leader in gem exports in the past two years.

  He said Hong Kong was overcoming its cost problem and was enhancing competitiveness by moving factories to China.

  Mr Shin said TDC statistics about jewellery products manufactured in Hong Kong were misleading.

  Though the last step of the manufacturing might be done in Hong Kong, many earlier production steps took place in China, he said. This had allowed Hong Kong to compete with Thailand and the export value from both places was close, Mr Shin said.

  The TDC said domestic exports were 78 per cent of total exports in the first eight months of 1994, and re-exports of China origin took 7.2 per cent.

  Hong Kong was the fourth largest exporter of jewellery in the world after Italy, Switzerland and Britain in 1992.

  Mr Shin said Hong Kong still had many advantages over Thailand, despite rocketing production costs.

  Hong Kong was more flexible in adapting to the world market because many manufacturers were small and medium companies, while Thailand was dominated by large consortiums, he said.

  Jewellery manufacturing in Thailand would face serious problems during a low ebb in the world market, he said.

  Hong Kong had more experience for the United States market, which took up 40 per cent of the total exports in the first eight months of 1994. This meant Hong Kong was able to follow fashions more closely.

  The low profit tax rate and the lack of foreign currency control enabled Hong Kong to at least keep up with Thailand, he said.

  'You can bring as much foreign currency as you like to Hong Kong, and that is important for jewellery trade,' he said.

  Hong Kong was concentrating on high and middle-end products while Thailand focused on low-end products.

  Despite the competition between the two places, Hong Kong's exports to Thailand leapt by 300 per cent last year, according to TDC figures.

  Many factories in Thailand might need to import jewellery goods from Hong Kong if the production in Thailand could not cope with the orders.

  Exports to other emerging Asian markets increased dramatically over the past year, rising more than 150 per cent to Malaysia, by more than 100 per cent to South Korea, and by more than 70 per cent to Taiwan, according to the TDC.

   Tse Sui Luen Jewellery Exports director Ken Wong said the local market was almost saturated.

  The company would concentrate on marketing strategy to increase its market share in Hong Kong, he said.

  He said most of the company's products for local sales were manufactured in Hong Kong because the quality of workmanship on mainland China remained unsatisfactory.



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