The once highly vaunted clothing industry of Hong Kong is going through a very difficult phase. Production as well as exports of garments is in a declining mode since the last few years. Notwithstanding the slow growth in exports by value, overall growth rates are seeing a fall since the last three consecutive years.
Global export growth rates have fallen from a high of 8.6 percent in 2005 to 3.9 percent in 2006 and then to a low of just 1.9 percent in 2007. Now, in fact for the first time, growth rates have turned negative in the first six months of 2008.
Exports which stood at US $27.21 billion in 2005 rose to $28.27 billion in 2006 to post a growth of a marginal 3.9 percent. Shipments in 2007 also recorded a minuscule growth by adding up to only 1.9 percent, by ascending to just $28.77 billion in comparison to 2006.
The overall performance in the first six months of the current year depicts a picture worse than in the preceding three years. Exports made in the period Jan-June 2008 fell to $12.30 billion from $12.59 billion in the corresponding period of 2007 to clock a de-growth of 2.30 percent.
The market of the US, which by far is the single biggest market for Hong Kong garment exporters with a share of 34.1 percent of all garment exports, has also seen a drop in its shipments. Compared to the first six months of the previous year, shipments have seen a dip of nearly 8 percent to touch $4.19 billion in the first half of the current year.
Shipments, though to its second biggest buyer with a share of 11 percent has seen a very marginal growth. Exports to the United Kingdom rose to $1.35 billion to clock a nominal gain of just 0.8 percent. Amongst other countries, garment exporters from Hong Kong managed to grow their exports to Germany to $1.02 billion to register a net growth of 5.4 percent.
Exports to its neighboring country, mainland China have also maintained the same pattern as witnessed in the last two years. Shipments have gone down by 12.4 percent to reach $713 million in the period January to June '08.
A slump in exports to Mainland China has been observed in the last three years. They have dropped by 8.80, 13.6 and 11.3 percent in the twelve month periods of 2005, 2006 and 2007, when compared with corresponding figures of 2004, 2005 and 2006 respectively.
Japan, which again is among the top five buyers of apparels from the territory, has also seen its imports falling by 10.3 percent to reach $689 million in the period under review. This country had also seen its imports fall by 3.8 percent in the full year of 2007.
Other countries which have noticed a growth in their imports of clothing from Hong Kong are Finland with 29.5 percent, the Russian federation 23.8 percent, Netherlands 20.1 percent and UAE 15.7 percent.
Countries which have seen a major drop in their imports are Panama with 23.1 percent, the kingdom of Saudi Arabia 22.9 percent, neighbouring Taiwan 13.4 percent and Indonesia 7.1 percent.
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Fibre2fashion News Desk - India