Hong Kong’s Trade and Economic Relationship with Australia

(a) Points to Note

1. In 2021, Australia was Hong Kong’s 20^th largest trading partner.
   
   
2. Bilateral trade in goods between Hong Kong and Australia amounted to $52.6 billion (US$6.8 billion) in 2021. The average annual growth rate was -0.7% from 2017 to 2021.
   
   
3. In 2021¹, Hong Kong was the world’s 6^th largest trading entity in merchandise trade while Australia ranked 23^rd.
   
   
4. Hong Kong was Australia’s 18^th largest trading partner, 13^th largest export market and 37^th largest source of imports in 2021².
   
   
5. In 2021, HK$40.1 billion³ (US$5.2 billion) worth of trade between Australia and the Mainland was routed through Hong Kong, representing around 2.2%⁴ of the total trade between Australia and the Mainland.

(b) Summary of Hong Kong’s Trade with Australia

Value in HK$ million (US$ million)

	2021	% Change over 2020	Jan - Mar 2022	% Change over Jan - Mar 2021
(a) Domestic Exports	778 (100)	+31.95	234 (30)	-15.3
(b) Re-exports - of Mainland origin	35,376 (4,551) 29,834 (3,838) 84.3%*	+12.6 +10.5	7,111 (911) 5,906 (757) 83.1%*	-9.0 -10.4
(c) Total Exports [(a)+(b)]	36,154 (4,651)	+13.0	7,345 (941)	-9.2
(d) Imports	16,442 (2,115)	-1.0	3,438 (440)	-17.8
(e) Total Trade [(c)+(d)]	52,596 (6,766)	+8.2	10,783 (1,381)	-12.2
(f) Balance of Trade [(c)-(d)]	19,713 (2,536)		3,907 (501)

* Figure denotes percentage share of Mainland-origin re-exports over total Hong Kong re-exports to Australia.

(c) Major Categories of Commodities Traded between Hong Kong and Australia in 2021

Domestic Exports to Australia
Australia ranked 14^th among Hong Kong’s domestic exports markets.

The top three commodities were (in descending order):

• Non-ferrous metals (24.3%)
• Miscellaneous edible products and preparations (19.2%)
• Petroleum, petroleum products and related materials (15.9%)

Re-exports to Australia
Australia ranked 20^th among Hong Kong’s re-exports markets.

The top three commodities were (in descending order):

• Telecommunications and sound recording and reproducing apparatus and equipment (22.7%)
• Office machines and automatic data processing machines (15.8%)
• Articles of apparel and clothing accessories (8.7%)

Imports from Australia
Australia ranked 22^nd among Hong Kong’s sources of imports.

The top three commodities were (in descending order):

• Vegetables and fruit (12.8%)
• Meat and meat preparations (10.7%)
• Telecommunications and sound recording and reproducing apparatus and equipment (8.5%)

Separately, the import of wine, especially sparkling wine, red wine and white wine grew 8.1% in the period of Jan – Mar 2022 compared to the same period in 2021, with a total amounted to HK$222 million, occupying a share of 6.4% of all imports from Australia.

1	Source: WTO Statistics Database.
2	Source: Department of Foreign Affairs and Trade, Australia.
3	Trade between Australia and the Mainland routed through Hong Kong is estimated by summing up (i) Australian origin re-exports to the Mainland; and (ii) Mainland-origin re-exports to Australia (Source: C&SD).
4	The percentage = (a) Trade routed through Hong Kong ÷ (b) Total trade (including re-export) between the Mainland and Australia. While (a) is worked out from statistics compiled by C&SD (please see footnote 3); and (b) is obtained by adding total trade figure from the Mainland’s General Administration of Customs and C&SD’s figure of Mainland-origin re-export to Australia via Hong Kong. Since two different sources of data are involved, the calculated percentage is solely indicative.
5	The increase was mainly due to the increase in domestic exports of “silver, platinum and other metals of the platinum group” by 209.3% in 2021. This product item accounted for 10.3% of domestic exports to Australia in 2020.

 

(a) Points to Note

1. In 2020, Australia was our 8^th largest trading partner, 8^th largest export market (2.9% of total exports of services), and 6^th largest source of imports (3.5% of total imports of services).
   
   
2. In 2021⁶, Hong Kong was the world’s 20^th largest commercial services trading entity while Australia ranked 28^th.
   
   
3. The average annual growth rate in bilateral trade in services between Hong Kong and Australia was -8.8% from 2016 to 2020. The bilateral trade in services decreased by 34.9% in 2020.
   

(b) Summary of Hong Kong’s Trade in Services with Australia

Value in HK$ million (US$ million)

	2019	% Change over 2018	2020	% Change over 2019
(a) Exports	19,109 (2,439)	-8.4	14,304 (1,844)	-25.1
(b) Imports	25,251 (3,222)	-3.6	14,588 (1,881)	-42.2
(c) Total Trade [= (a) + (b)]	44,360 (5,661)	-5.7	28,892 (3,725)	-34.9
(d) Net Export of Services [= (a) – (b)]	-6,142 (-784)	-	-284 (-37)	-

(c) Major Groups of Service Traded between Hong Kong and Australia in 2020

Exports to Australia
Australia ranked 8^th among Hong Kong’s exports markets (2.9% of total exports of services). From 2016 to 2020, the average annual growth rate was -5.2%.

The top three service components were (in descending order):

• Transport
• Financial services
• Other business services

Imports from Australia
Australia ranked 6^th among Hong Kong’s sources of imports (3.5% of total imports of services). From 2016 to 2020, the average annual growth rate was -11.7%.

The top three service components were (in descending order):

• Transport
• Travel
• Other business services

6	Source: WTO Statistics Database.

(a) Points to Note

In a survey covering 9 049 companies in Hong Kong with parent companies located outside Hong Kong, as at June 2021, there were 28 regional headquarters, 54 regional offices and 87 local offices in Hong Kong with parent companies located in Australia.

(b) Summary of Hong Kong’s Bilateral Investment with Australia

Value in HK$ million (US$ million)

Australia’s position among selected major investor country/territory in HK	Inward direct investment (DI) at market value
	Position of inward DI at end 2020	DI inflow in 2020
20th	29.5 (3.8)	-5.17 (-0.7)

Value in HK$ million (US$ million)

Australia’s position among selected major recipient country/territory in HK	Outward direct investment (DI) at market value
	Position of outward DI at end 2020	DI outflow in 2020
10th	142.4 (18.4)	10.3 (1.3)

7	Negative inflow does not necessarily relate to equity withdrawal. It may be the result of repayment of loans owed to non-resident affiliates.

1. Hong Kong and Australia signed an FTA and an Investment Agreement (IA) on 26 March 2019. The two agreements entered into force on 17 January 2020. The new IA, upon its entry into force, replaces the IPPA signed between Hong Kong and Australia in 1993.

1. While Australia is not one of the countries along the Belt and Road, it was ratified as a founding member of the Asia Infrastructure Investment Bank in November 2015.


2. On 21 April 2021, the Australian Minister for Foreign Affairs announced that the MoU signed between Mainland China and the Victoria State Government would be cancelled given its inconsistency with Australia’s foreign policy or adverse impact to the foreign relations in line with the relevant test in Australia’s Foreign Relations (State and Territory Arrangements) Act 2020.

*Source: International Monetary Fund (IMF) – World Economic Outlook Database. Estimated figures are in square brackets.
^#Source: C&SD. ^Figures are subject to revisions when updated information is available. Figures with ^P are provisional figures.