Researchers from the Hong Kong Trade Development Council predict Hong Kong’s exports will grow by 4% in 2025.
This comes after the economy experienced a 9.9% surge in exports during the first 10 months of 2024, riding on strong demand for electronics exports which grew 13.5% in the same period.
In contrast, exports of toys, watches and clocks and precious jewellery fell between January and October this year by 24.5%, 10% and 5.5% respectively.
Demand for AI-enabled electronics is expected to stay consistently strong into 2025, according to HKTDC Director of Research, Irina Fan. “Consumer sales are expected to be bolstered by the launch of a new generation of AI-integrated smartphones, PCs and other digital devices,” she said.
Although the underlying trend remains positive, she predicts a number of potential challenges may impact Hong Kong’s export activity over the 12 months to come.
These concerns stem from the well-publicised comment by US President-Elect Donald Trump that he will impose massive tariff hikes on goods imported from multiple sources, including Mexico, Canada and Mainland China. If this happens, it is widely expected that global trade flows will be adversely affected, while the process of trade diversion will accelerate. Both have negative implications for Hong Kong’s trade outlook.
The threat of tariff rises, coupled with concern over growing geopolitical uncertainties elsewhere in the world, have been reflected in HKTDC’s fourth quarter Export Confidence Index. The Current Performance Index fell from 52.6 in the third quarter to 50.3 in quarter 4 and the Expectation Index decreased from 51.4 to 50.
In line with such caution, exporters are likely to accelerate their shipping schedules to mitigate the consequences of tariffs later in the year, with the result that activity will be far more intense in the first half of 2025, before decelerating sharply in the latter half.
Irina Fan said: “While 2025 may be a year of two halves, characterised by differing levels of activity, we still see overall export growth as likely to be 4% after factoring in the concerns expressed by traders across a range of global economic uncertainties.”
