Based on the average exchange rate for 2020, the Hong Kong dollar has appreciated by 0.1% against the US dollar since 2016 and strengthened by 1% from 2019 to 2020. Hong Kong’s stronger local currency makes exports paid for in weaker US dollars relatively more expensive for international buyers.
The latest available country-specific data shows that 84.3% of products exported from Hong Kong were bought by importers in: mainland China (55.2% of the global total), United States (7.2%), United Kingdom (3.3%), Switzerland (2.7%), Japan (2.6%), India (2.4%), Taiwan (also 2.4%), Vietnam (2%), Singapore (also 2%), Netherlands (1.5%), Germany (1.5%) and Thailand (also 1.5%).
From a continental perspective, 75.4% of Hong Kong’s exports by value were delivered to fellow Asian countries while 13.5% were sold to importers in Europe. Hong Kong shipped another 8.2% worth of goods to North America.
Smaller percentages went to Africa (1.1%), Oceania led by Australia (0.9%) then Latin America excluding Mexico but including the Caribbean (also 0.9%).
Given Hong Kong’s population of 7.5 million people, its total $551.5 billion in 2020 exports translates to roughly $73,800 for every resident in the Chinese administrative territory.
Hong Kong’s Top 10 Exports
Top 10
The following export product groups represent the highest dollar value in Hong Kong global shipments during 2020. Also shown is the percentage share each export category represents in terms of overall exports from Hong Kong.
- Electrical machinery, equipment: US$311.6 billion (56.5% of total exports)
- Machinery including computers: $74.8 billion (13.6%)
- Gems, precious metals: $70.6 billion (12.8%)
- Optical, technical, medical apparatus: $18.4 billion (3.3%)
- Plastics, plastic articles: $8 billion (1.4%)
- Clocks , watches including parts: $6 billion (1.1%)
- Perfumes, cosmetics: $4.9 billion (0.9%)
- Toys, games: $4.6 billion (0.8%)
- Knit or crochet clothing, accessories: $4.2 billion (0.8%)
- Clothing, accessories (not knit or crochet): $3.6 billion (0.7%)
Hong Kong’s top 10 exports accounted for 91.9% of the overall value of its global shipments.
Gems and precious metals was the fastest grower among the top 10 export categories, up by 30.4% from 2019 to 2020.
In second place for improving export sales was perfumes and cosmetics via a 22.8% gain.
Hong Kong’s shipments of machinery including computers posted the third-fastest gain in value up by 6%.
Year over year, the leading decliner among Hong Kong’s top 10 export categories was unknitted and non-crocheted clothing or accessories thanks to its -34.7% drop.
From the more detailed four-digit Harmonized Tariff System (HTS) code level, Hong Kong’s most valuable exported products are electronic circuits and microassemblies (27.9% of its total) trailed by phone system devices including smartphones (12.3%). Other top exported goods from Hong Kong also include gold (7.5%), computer parts or accessories (4.7%), computers including optical readers (4.4%), solar power diodes and semi-conductors (2.6%), unmounted diamonds (1.9%), electrical converters and power units (1.7%), printed circuits (also 1.7%) then turbo-jets (1.5%).
Advantages
The following types of Hong Kong product shipments represent positive net exports or a trade balance surplus. Investopedia defines net exports as the value of a country’s total exports minus the value of its total imports.
In a nutshell, net exports represent the amount by which foreign spending on a home country’s goods or services exceeds or lags the home country’s spending on foreign goods or services.
- Gems, precious metals: US$15.8 billion (Reversing a -$178.5 million deficit in 2019)
- Machinery including computers: $7.5 billion (Up by 79.8%)
- Toys, games: $1 billion (Down by -22.7%)
- Plastics, plastic articles: $858.5 million (Up by 6.6%)
- Glass: $800.5 million (Down by -21.2%)
- Knit or crochet clothing, accessories: $596.6 million (Down by -33.6%)
- Optical, technical, medical apparatus: $556.5 million (Up by 94.9%)
- Other chemical goods: $370.7 million (Up by 1,609%)
- Books, newspapers, pictures: $361.2 million (Down by -30.1%)
- Special woven/tufted fabric, embroidery: $303.6 million (Down by -21.5%)
Hong Kong had highly positive net exports in the international trade of gems and precious metals in 2020, particularly gold. In turn, these cashflows indicate Hong Kong’s strong competitive advantages under the gems and precious metals category.
Opportunities
Overall, Hong Kong incurred a -$21.5 billion trade deficit for 2020, a -49.8% reduction from -$42.9 billion in red ink one year earlier.
Below are exports from Hong Kong that result in negative net exports or product trade balance deficits. These negative net exports reveal product categories where foreign spending on home country Hong Kong’s goods trail spending on foreign products by importers in Hong Kong.
- Electrical machinery, equipment: -US$10.1 billion (Up by 48% since 2019)
- Mineral fuels including oil: -$8.4 billion (Down by -39.1%)
- Meat: -$4.9 billion (Up by 15.5%)
- Perfumes, cosmetics: -$3.6 billion (Up by 52.2%)
- Fish: -$2.3 billion (Down by -7.8%)
- Beverages, spirits, vinegar: -$1.8 billion (Down by -4.8%)
- Vehicles: -$1.8 billion (Down by -22.3%)
- Pharmaceuticals: -$1.5 billion (Up by 7.9%)
- Collector items, art, antiques: -$1.4 billion (Down by -37.2%)
- Fruits, nuts: -$1.3 billion (Down by -13.8%)
Hong Kong has highly negative net exports and therefore deep international trade deficits notably for electrical machinery and equipment, and also for refined petroleum oils, petroleum gas and electricity under the mineral fuels including oil category.
These cashflow deficiencies clearly indicate Hong Kong’s competitive disadvantages in the international energy market, but also represent key opportunities for Hong Kong to improve its position in the global economy through focused innovations.
Companies
Hong Kong Export Companies
Fifty-eight corporations based in Hong Kong ranked on the Forbes Global 2000. Below is a sample of the major Hong Kong companies that Forbes included.
- Belle International Holdings (clothing, footwear)
- China Agri-Industries (diversified chemicals)
- China Mengniu Dairy (food processing)
- Chow Tai Fook Jewellery (clothing accessories)
- Citic Pacific (iron, steel)
- CNOOC (oil, gas)
- Lenovo Group (computer hardware)
- Michael Kors Holdings (clothing accessories)
- TPV Technology (computer storage devices)
- ZTE (communications equipment)
According to global trade intelligence firm Zepol, the following are smaller exporting firms working out of Hong Kong.
- E Bo Toys (tricycles, other wheeled toys)
- Fine Ceramic (ceramic kitchenware/tableware)
- Forever Bright Lighting (chandeliers, light fittings)
- Perfect Electronic (burglar/fire alarms)
- Wieson Technologies (electric switches, protectors, conductors, connectors)
In macroeconomic terms, Hong Kong’s total exported goods represent 116.7% of its overall Gross Domestic Product for 2020 ($472.4 billion valued in Purchasing Power Parity US dollars) and includes a high level of reexporting. That 116.7% for exports to overall GDP in PPP for 2020 compares to 109.1% one year earlier. Those percentages suggest a relatively decreasing reliance on products sold on international markets for Hong Kong’s total economic performance albeit based on a short timeframe.
Another key indicator of a country’s economic performance is its unemployment rate. Hong Kong’s unemployment rate was 6.4% at April 2021, up from 5.9% one year earlier according to Trading Economics.
As a Special Administrative “Region” of China, Hong Kong serves as its own capital city.
See also Hong Kong’s Top Trading Partners and Hong Kong’s Top 10 Imports
Research Sources:
Central Intelligence Agency, The World Factbook Country Profiles. Accessed on May 25, 2021
Forbes Global 2000 rankings, The World’s Biggest Public Companies. Accessed on May 25, 2021
International Monetary Fund, Exchange Rates selected indicators (National Currency per U.S. dollar, period average). Accessed on May 25, 2021
International Monetary Fund, World Economic Outlook Database (GDP based on Purchasing Power Parity). Accessed on May 25, 2021
International Trade Centre, Trade Map. Accessed on May 25, 2021
Investopedia, Net Exports Definition. Accessed on May 25, 2021
Wikipedia, Gross domestic product. Accessed on May 25, 2021
Wikipedia, Hong Kong. Accessed on May 25, 2021
Wikipedia, List of companies of Hong Kong. Accessed on May 25, 2021
Wikipedia, Purchasing power parity. Accessed on May 25, 2021
Zepol’s company summary highlights by country. Accessed on May 25, 2021
