Hong Kong fears US-China trade war will hurt trade volumes

SECRETARY for Commerce and Economic Development Edward Yau says Hong
Kong is worried about the worsening trade row between China and the US
given that 17 per cent, or HKD60 billion (US$7.6 billion) worth of
Chinese exports in question passed through the city to the US, and
nine per cent, or HKD6 billion, of US exports were transshipped via
the city to mainland China.

"We are worried about the worsening Sino-US trade dispute and it is a
pity to see that the goodwill the two countries built over the years
is being lost," Mr Yau told the SCMP in a phone interview from Paris,
France while on a business tour with Chief Executive Carrie Lam.

"We fear that the trade war will become an irreversible step as each
side only cares about its own interests," he said.

Hong Kong also faced an "unquantifiable impact from the spillover" of
the dispute between the US and Europe, which could lead to trade being
diverted from Hong Kong, he said.

Beijing and Washington are ensnared in a tit-for-tat trade row, with
China on June 19 vowing to use quantitative and qualitative measures
to retaliate if US President Donald Trump's threat to impose a 10 per
cent punitive tariff on US$200 billion worth of Chinese products went
into effect.

Following Mr Trump's announcement on June 15 to impose 25 per cent
tariffs on $50 billion worth of Chinese imports, Beijing responded by
publishing a list of US products - ranging from soybeans to cars -
that it would subject to retaliatory measures of the "same scale and
intensity." Beijing calculated that the value of US product imports
last year was $154 billion.

"Hong Kong can withstand the tariff tsunami if it continues to develop
its regional relationships and Greater Bay Area and advancing on IT
development," said American Chamber of Commerce in Hong Kong president
Tara Joseph, 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 US.

According to the Hong Kong government's trade figures, Asean became
the city's second largest trade partner after mainland China 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.

Federation of Hong Kong Industries chairman Jimmy Kwok said Hong Kong
companies in the re-export and transshipment business would be hit

"The trade war has spread to food such as meat and fish, which to some
extent will put them in trouble," Mr Kwok said.
LNG Terminal is progressing at a good pace and the environmental
impact assessment study for the project has been submitted to the
government. Discussions are ongoing to develop and reach a definitive
agreement for the supply of the FSRU which will assist in improving
the long-term energy security for Hong Kong as well as providing
access to competitive natural gas supply from world markets," the MOL
statement said.