Traders will suffer only a moderate downturn in export growth this year despite the appreciation of the Hong Kong dollar and yuan against most regional currencies, according to a Hang Seng Bank report. The report finds that the currency gains of neighbouring economies are being offset by rising import costs for raw materials and tight credit. Export growth was expected to slow from 4.2 per cent last year to 2.5 per cent this year, the report said. 'Hong Kong exporters could continue to compete effectively in the international arena, benefiting from factors such as being the leading manufacturers in the global market in many industries, a broad product range and a stable financial environment,' the report added. A survey of 52 manufacturing exporters found that 75 per cent of their exports were to the United States and European markets and 12 per cent were sold intra-regionally. About 60 per cent said their orders from the US and Europe had increased while only 22 per cent reported a fall. Reasons given for the buoyant demand ranged from claims that their products were of better and more reliable quality to their production bases on the mainland remaining cost-effective and providing good-quality products. Hong Kong's status as a 'global merchandiser' - where factories can be located offshore - enabled it to take advantage of low-cost manufacturing bases on the mainland and in other countries.
