The Korea International Trade Association announced on Nov. 20 that South Korea’s exports to Hong Kong for the first 10 months of this year totaled US$26,847 million, down 32.9 percent from a year ago, due to declines in semiconductor prices, U.S.-China trade disputes, and Hong Kong’s political unrest.
The rate of decrease is more than three times the negative export growth of South Korea during the same period. If this pace continues, South Korea’s annual exports to Hong Kong are likely to decrease for the first time since 2014 and show the highest rate of decrease since 1976.
Last year, Hong Kong was the fourth-largest export destination for South Korea behind China, the United States and Vietnam. According to the association, semiconductors and memory chips account for 73 percent and 63.3 percent of South Korea’s total exports to Hong Kong, respectively.
South Korea’s semiconductor exports to Hong Kong have been sluggish since late last year and the protests in the country have compounded the matter since June this year. Hong Kong’s importance for South Korea’s exports is because a lot of exports from South Korea to China are made via Hong Kong.
Last year, 82.6 percent of South Korean products imported by Hong Kong were exported to China. Specifically, Hong Kong’s imports from South Korea totaled US$35.5 billion, products worth 94 percent of the total were re-exported, and China was the destination of 82.6 percent of the re-exports.