The overall trade impact of the Indian Ocean earthquakes and tsunamis for Hong Kong will be modest,the Hong Kong Trade Development Council said Wednesday.
The size of Hong Kong's trade with the affected countries is relatively small, only taking up 5 percent of Hong Kong's total trade with the world in January-October 2004, the TDC said in a report.
Hong Kong's exports to the affected countries are mainly related to processing trade, of which 51 percent are raw materialsand 32 percent are machinery. Since the disaster did not destroy any major industrial and port facilities of the affected countries,its impact on the region's processing trade and in turn Hong Kong's exports will not be excessive, it said.
Accordingly, damages to Hong Kong's trade will be contained andlargely confined to consumer goods, mainly audio-visual equipment,clothing timepieces and toys, which account for 17 percent of HongKong's export to the region.
However, for any individual markets, the exact impact on Hong Kong exports will pivot on consumer goods' share in the trade which varies by country.
Despite a small value of goods being traded, the Maldives and Seychelles are most affected markets for Hong Kong exports, given that 60 percent of the trade are consumer goods, likely for satisfying tourist demand.
For other markets which have stronger ties with Hong Kong, consumer goods are not the main items being traded and thus the impact on Hong Kong exports should be rather limited. Say for Thailand, Malaysia, India and Indonesia, while they together account for 89 percent of Hong Kong's exports to the affected region, 82 percent of goods being traded are raw materials or machinery, leaving the remaining for direct consumption.