The effects of the escalating U.S.-China trade row could spiral down and hurt Hong Kong, the city’s commerce chief has warned.
Edward Yau Tang-wah, travelling with Chief Executive Carrie Lam Cheng Yuet-ngor on a business tour in Europe, said in a phone interview on Tuesday night that about 17 per cent, or HK$60 billion (US$7.6 billion) worth, of Chinese exports in question passed through the city to the United States, and about 9 per cent, or HK$6 billion, of U.S. exports went to mainland China via the city.
Hong Kong also faced an “unquantifiable impact from the spillover” of the dispute between the U.S. and Europe, which could trigger trade to divert from Hong Kong, he said.
Beijing and Washington are embroiled in a tit-for-tat trade row, with China on Tuesday vowing to use quantitative and qualitative measures to hit back if U.S. President Donald Trump’s threat to impose a 10 per cent punitive tariff on US$200 billion worth of Chinese products went ahead.
Tara Joseph, president of the American Chamber of Commerce in Hong Kong (AmCham), said she expected the turbulence arising from the tit-for-tat trade dispute would prevail, and businesses should brace themselves.
“There is a common concern on what the impact of the trade frictions will have on the global economy,” she said. “The impact is not unique to Hong Kong.”
Areas most affected were for example the global supply chain, stock markets and agricultural sectors, Joseph said.
“Hong Kong can withstand the tariff tsunami if it continues to develop its regional relationships and Greater Bay Area and advancing on IT development,” she said, referring to Beijing’s plan to develop Hong Kong, Macau and nine cities in Guangdong into a new economic zone and IT-led powerhouse rivalling Silicon Valley in the U.S.
Citing a recent AmCham survey, Joseph said many members polled were looking for business opportunities on the mainland and in Southeast Asia.
According to the Hong Kong government’s trade figures, Asean became the city’s second-largest trade partner after the mainland last year in total trade. The Association of Southeast Asian Nations is an economic bloc comprising Indonesia, Malaysia, Singapore, the Philippines, Thailand, Brunei, Cambodia, Laos, Myanmar and Vietnam.
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