The Hong Kong Trade Development Council (HKTDC) has substantially revised upward its forecast for Hong Kong’s merchandise export growth in 2026 to 42%-47%, following significantly stronger-than-expected global demand for artificial intelligence (AI)-related technologies, prompting a major upgrade to the trade outlook. Meanwhile, the latest HKTDC Export Confidence Index (3Q26) indicates that exporter sentiment remains broadly positive despite ongoing geopolitical uncertainties. The Current Performance Index stood at 51.8, while the Expectation Index registered 51.3, with both remaining above the neutral 50-point threshold.
AI-driven electronics exceed expectations
Commenting on the export outlook, HKTDC Director of Research, Bruce Pang, said: “The strong Hong Kong export growth recorded this year has been driven primarily by the rapid acceleration of global demand for AI-related products and infrastructure. Demand for semiconductors, memory chips, computer components, telecommunications equipment and other advanced electronics expanded much faster than expected, providing substantial support to Hong Kong’s exports.”
Electronics remained the dominant growth engine, accounting for approximately 80% of Hong Kong’s total exports in the first eight months of 2026. Exports of electronics rose by 52.8% year-on-year, significantly outpacing overall export growth. Major markets included the Chinese Mainland, ASEAN and the US, reflecting strong demand across global technology supply chains.
Particularly notable was the strong performance of items related to growing investments in AI infrastructure, cloud computing, data centres and next-generation digital technologies worldwide. AI-related electronics now account for an increasingly significant share of Hong Kong’s exports.
Growth with broader regional trade flows throughout Asia
The strong export performance has not been confined to a narrow range of technology items. HKTDC Deputy Director of Research, Wing Chu, said: “Exports of a broad range of conventional electronic parts and components have continued to perform strongly. Regional manufacturing networks spanning the Chinese Mainland and ASEAN economies remain highly active, supporting vigorous trade flows throughout Asia. At the same time, export performance across many traditional industries has remained broadly stable, reflecting continued overseas demand and resilient consumption in major markets.”
ASEAN continues to be one of Hong Kong’s most dynamic export destinations, while exporter sentiment towards both ASEAN and the Chinese Mainland remains firmly positive. Regional trade flows across Asia have remained exceptionally strong amid the ongoing technology upcycle, demonstrating the resilience of regional production networks and supply chains. The Chinese Mainland’s high-technology manufacturing sector has remained in expansion territory, helping sustain demand for electronic components and related intermediate goods.
Exports remain robust amid evolving US trade policies
Recent developments in US trade policy have introduced additional uncertainty into the global trading environment. In July, the United States imposed an additional 12.5% Section 301 tariff on imports from a number of trading partners, including the Chinese Mainland and Hong Kong. Nevertheless, Hong Kong’s exports to the United States have remained remarkably resilient, with US-bound exports rising by 63.4% year-on-year in the first eight months of 2026.
Bruce Pang added: “While the latest Section 301 tariff measures have added a degree of uncertainty for businesses, the direct impact on Hong Kong exports is expected to be limited. A substantial share of Hong Kong’s exports to the United States consists of products covered by tariff exemption arrangements, particularly in the technology and electronics sectors.”
“Recent developments in China-US relations have also helped improve the trade environment. The September Xi-Trump meeting and extension of the trade truce until January 2027, coupled with the US$30 billion Reciprocal Tariff Reduction Arrangement, provide a welcome period of stability, reducing the risk of further tariff escalation in the coming months. The extended policy dialogue between the two sides has also led to further easing in bilateral trade tensions. Together with the continued strength of global demand for technology products, these developments should help underpin Hong Kong’s export performance in the months ahead.”
Hong Kong moving up the value chain
Beyond the cyclical upswing in technology demand, recent trade developments also point to a significant structural transformation in Hong Kong’s trade profile. According to HKTDC research, Hong Kong’s exports are increasingly concentrated in high-value, technology-intensive products such as integrated circuits, computer parts and advanced telecommunications equipment. These products are progressively replacing traditional lower-value, bulk merchandise as key contributors to export growth.
At the same time, Hong Kong’s trade logistics pattern is undergoing a profound shift, as the growing importance of high-value items, such as semiconductors and luxury products, has increased reliance on air freight. Hong Kong’s extensive air cargo network, combined with its close land transport connectivity with advanced manufacturing clusters in Southern China, has strengthened its position as a leading high-value international trade and logistics hub, as pledged in Hong Kong’s First Five-Year Plan.
Wing Chu said: “Hong Kong is increasingly handling products that are compact in size but exceptionally high in value, which are frequently transported via a combination of air cargo services serving overseas destinations and land transport links connecting Hong Kong with manufacturing centres in the Chinese Mainland. This transformation highlights Hong Kong’s evolution from a traditional trading gateway into a high-value-added international trade and supply chain management centre.”
Outlook remains constructive
Looking ahead, the HKTDC expects Hong Kong’s exports to maintain solid momentum through the remainder of 2026, supported by resilient global demand for technology products, and robust manufacturing and trade activities across the Chinese Mainland and other major destinations, such as ASEAN.
Nevertheless, exporters will continue to navigate a challenging and uncertain external environment. HKTDC Section Head of Special Project & Business Advisory, Kenneth Lee, said: “Businesses continue to face a range of external headwinds like geopolitical tensions, volatility in energy and commodity markets, and rising protectionist measures in certain economies. Despite these challenges, international consumption has remained relatively resilient in recent months, helping sustain demand for a broad range of consumer products. As a result, sectors such as clothing, watches and clocks, and jewellery have continued to deliver stable export performance alongside the strong growth seen in technology-related industries.”
References
– Hong Kong’s 2026 Export Outlook: Hong Kong Export Growth Forecast Upgraded to 42%-47%
https://research.hktdc.com/en/article/MjQzNzY3NzQ4Mg
– HKTDC Export Confidence Index 3Q26: Sentiment remains broadly positive
https://research.hktdc.com/en/article/MjQzNzY3MzkyMw
– Hong Kong’s Evolution into a High Value-Added Trade Hub
https://research.hktdc.com/en/article/MjQzOTM2OTY1MQ
– HKTDC Research website
https://research.hktdc.com/en/
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About HKTDC
The Hong Kong Trade Development Council (HKTDC) celebrates its 60th anniversary this year. The HKTDC is a statutory body established in 1966 to promote, assist and develop Hong Kong’s trade. With over 50 offices globally, including 13 in the Chinese Mainland, the HKTDC promotes Hong Kong as a two-way global investment and business hub. The HKTDC organises international exhibitions, conferences and business missions to create business opportunities for companies, particularly small and medium-sized enterprises (SMEs), in the mainland and international markets. The HKTDC also provides up-to-date market insights and product information via research reports and digital news channels. For more information, please visit: www.hktdc.com/aboutus.
