Hong Kong is looking forward to the upcoming free trade deal with Asean. Five Asean countries – Singapore, Thailand, Vietnam, Laos and Myanmar – have their free trade deals with Hong Kong taking effect soon. Similar agreements with the rest of Asean members – Brunei, Cambodia, Indonesia, the Philippines and Malaysia – will take place a bit later. The Asean free trade arrangement will allow Hong Kong firms access to ten markets for goods, services, investments, economic and technical cooperation and dispute settlement. Asean is Hong Kong’s second largest trading partner, after mainland China.
Battered by the intensifying US-China trade war, Hong Kong is looking to new markets and trade mechanisms. The pact with the ten-member Association of Southeast Asian Nations would be a crucial alternative for Hong Kong companies that rely on traditional markets, such as the United States and the European Union. Hong Kong has provided billions of dollars in funding to subsidise ventures by small and medium-sized enterprises into new markets. The free trade agreements have material and virtual impact that give Hong Kong companies business links and new business positioning.
Hong Kong’s exports fell 2.5 per cent in the first four months of 2019 from the same period last year.