SAR enjoys 12pc surge in exports for October

Hong Kong's exports in October rose 12.9 per cent year-on-year to $150.5 billion, the biggest jump and highest amount since October 2000, boosted by demand from China and other Asian countries.

The numbers also looked better because of a poor export performance in the same month last year, when the value of shipments fell 13.9 per cent. October's export surge, the fifth consecutive month of growth, follows a 10 per cent increase in September.

'It is simply that China's recent outperformance is spilling over to the Hong Kong sector,' said Ben Simpfendorfer, an economist at JPMorgan Chase.

'Hong Kong is benefiting from lower quotas on China's exports to developed markets, such as textiles, so it can now source more goods from the mainland and ship them abroad,' he said, adding that that should boost Hong Kong's gross domestic product growth.

The value of re-exports, or shipments passing through Hong Kong to a final destination, surged 15.7 per cent to $139.1 billion while exports of products made locally fell 12.6 per cent to $11.5 billion.

Re-exports make up the bulk of Hong Kong's exports, and the majority of re-exports are shipments on their way to or from China.

Hong Kong's export figures have been boosted in recent months by China's export performance. China's October exports rose more than 30 per cent from the same month last year, and have risen almost 21 per cent year-on-year to US$262.5 billion (HK$2 trillion) in the first 10 months of the year.

SAR shipments to other Asian countries last month were also strong, particularly to South Korea, Malaysia, the Philippines and Thailand, the government said. Exports to Japan and Europe picked up momentum while shipments to the United States slowed because of the labour dispute on the US West Coast.

Imports rose 13.4 per cent to $153.4 billion from a year earlier, resulting in a trade deficit of $2.8 billion.

Kevin Lai, an economist at National Australia Bank, said the recovery in export growth will probably last until next year but may not stay at such high levels.

'It is questionable whether this regional demand can last. Basically it very much depends on China and Korea,' Mr Lai said.

From January to October, the value of total shipments rose 3.2 per cent over the same period last year, while imports fell 0.9 per cent, resulting in a trade deficit of $50.8 billion, narrower than the $77.8 billion in the same period last year.