Hong Kong Trade Slides With Imports Contradicting China Data

Hong Kong’s exports unexpectedly fell in February by the most for a holiday month since 2009, while a drop in imports from China contrasted with mainland data showing an increase in shipments to the city.

Outbound shipments from Hong Kong fell 16.9 percent from a year earlier, the city’s Census and Statistics Department said today. That was lower than all 10 estimates in a Bloomberg News survey, with the median forecast for a 4.4 percent gain. Hong Kong said imports from China dropped 18 percent, while China’s customs administration said March 8 that shipments to the city rose 35.6 percent.

The report adds to a widening divergence between Hong Kong and China’s bilateral trade data, with Mizuho Securities Asia Ltd. and HSBC Holdings Plc saying mainland figures may be inflated by companies that move goods in and out of special trade zones to claim tax rebates. Overstated data would mean China’s economy is failing to get the boost from global demand that the numbers indicate.

“Some mainland exporters may have inflated their declarations to get the export tax rebate, and that may have played a role in the difference,” Lu Jiang, an economist at JPMorgan Chase & Co. in Hong Kong, said today. Different statistical methods mainly account for the disparity, Jiang said.

Almost all of Hong Kong’s exports consist of re-exports to other countries. Many of Hong Kong’s imports are destined for processing on the mainland, and “external demand for Chinese goods is not very strong at the start of the year,” Jiang said.

Last month had fewer working days than a year earlier because of the timing of the Lunar New Year holiday, which occurred in February this year and in January of 2012.

Imports Drop

Hong Kong’s total imports slid 18.3 percent from a year earlier, also below all 10 analyst estimates and the median forecast for a 2.5 percent decline. February imports from China of HK$106.2 billion ($13.7 billion) contrast with China’s reported $25.1 billion in exports to Hong Kong.

The Hong Kong statistics department said March 21 in an e-mailed response to questions from Bloomberg News that it is only responsible for the city’s official data and won’t comment on mainland figures. Hong Kong’s and China’s trade statistics are also compiled using different methods and can’t be directly compared, the department said.

China’s General Administration of Customs said in January that every dollar of trade is documented and that the statistics only record companies’ actual trade with overseas partners, including those in Hong Kong.

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