HKTDC: AI-related demand is rising rapidly; raises Hong Kong's export growth forecast for this year to 42% to 47%.

HKTDC: AI-related demand is rising rapidly; raises Hong Kong's export growth forecast for this year to 42% to 47%. The Hong Kong Trade Development Council (HKTDC) has significantly revised its trade outlook, sharply upgrading its forecast for Hong Kong's merchandise export growth in 2026 to 42% to 47%, mainly in light of global demand for AI-related technology exceeding expectations. Meanwhile, the newly released HKTDC Export Confidence Index for the third quarter of 2026 shows that despite persistent geopolitical uncertainty, Hong Kong exporters' confidence has remained broadly positive. The Current Index came in at 51.8, while the Expectation Index stood at 51.3, both above the 50 mark that separates optimism from pessimism. HKTDC Research Director Pong Ming said Hong Kong has recorded strong export growth this year, driven mainly by the rapid rise in global demand for AI-related products and infrastructure. Demand growth for semiconductors, memory chips, computer components, telecommunications equipment and other advanced electronic products has exceeded expectations, providing significant support for Hong Kong's exports. Electronics continued to be the main driver of export growth, accounting for about 80% of Hong Kong's total exports in the first eight months of 2026. During the period, electronics exports grew 52.8% year on year, well outpacing overall export growth. Major export markets included Mainland China, ASEAN and the United States, reflecting strong demand across the global technology supply chain. HKTDC Research Deputy Director Chiu Wing Chor said exports of a variety of traditional electronic components continued to perform strongly. Regional production networks spanning the Chinese and ASEAN economies remained very active, driving vibrant intra-Asia trade. At the same time, export performance in many traditional industries remained broadly stable, reflecting that overseas demand still exists and consumption in major markets remains resilient. The ASEAN region continued to be one of Hong Kong's export markets with the strongest growth momentum, with exporters maintaining firmly positive confidence in the ASEAN and Chinese markets. High-tech manufacturing in the mainland continued to be in expansion territory, further supporting demand for electronic components and related intermediate products. Hong Kong's exports to the United States continued to show strong resilience, rising 63.4% year on year in the first eight months of 2026. Pong Ming said that although the latest Section 301 tariff measures have brought a certain degree of uncertainty for businesses, the direct impact on Hong Kong's exports is expected to be limited. A large proportion of Hong Kong's exports to the United States are exempt from tariffs, especially technology and electronic products. HKTDC research shows that Hong Kong's exports are increasingly concentrated in high-value and technology-intensive products such as integrated circuits, computer components and advanced telecommunications equipment. These products are gradually replacing traditional, lower-value commodities as an important driving force behind export growth. Chiu Wing Chor noted that Hong Kong is now handling more and more goods that are small in size but extremely high in value, often combining air freight services to overseas markets with land transport connecting Hong Kong to China's manufacturing centres. This transformation reflects Hong Kong's gradual evolution from a traditional trade gateway into a high-value-added international trade and supply chain management centre. Looking ahead, the HKTDC expects Hong Kong's exports to maintain solid growth momentum for the remainder of 2026, supported by the resilience of global demand for technology products and by manufacturing and trade activity in other major markets such as China and ASEAN.