Exporters warned of squalls on horizon

Business | Samantha Wong 20 Dec 2018

Exporters based in the SAR have been urged by the Hong Kong Export Credit Insurance Corp to be vigilant in watching for risks after the Christmas period when the impact of the China-US trade conflict is expected to become more evident.

On that, the corporation warns that some traditional US retailers are facing financial difficulties.

"Despite the continuous economic expansion in the United States, the number of store closures remains high," said HKECIC commissioner Ralph Lai. "Retail store sales continue to be eroded by the rapid development of e-commerce.

"In addition, trade conflicts between the United States and the mainland, with a series of tariff actions, have complicated global trade relations, so there is negative sentiment."

So Hong Kong exporters must pay close attention to the performances of overseas buyers.

Besides keeping track of buyers' payments, Lai said, exporters should monitor their credit situations, which besides maintaining close contact with the firms concerned ould entail checking on sales performances and exchanging market information with counterparts.

And particular attention should be paid when there are cases of continuous losses, high inventory levels, excessive loans and over-expansion.

Established in 1966 under the Hong Kong Export Credit Insurance Corporation Ordinance, the Hong Kong government provides a guarantee of HK$55 billion for the HKECIC's contingent liability.

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