Is Hong Kong still an entrepôt under the Sino-U.S. trade war?

Chong, Terence Tai Leung and Lo, Vincent Pok Ho (2024): Is Hong Kong still an entrepôt under the Sino-U.S. trade war? Forthcoming in: Pacific Economic Review

Abstract

This paper studies the Hong Kong economy from a trade intermediary’s perspective. Using a structural vector autoregression (SVAR) framework, we discover that trade-related external shocks mainly affect the economy through re-exports channel over the offshore trade channel. We observe that re-exports shock does not transmit to the real economy through employment channel. A puzzling phenomenon is that trade-related employment has been in decline since 2008. Moreover, we notice that although the Sino-U.S. trade war exerted much downward pressure on economic growth between 2018 and 2019, the trade intermediary sector swiftly recovered in 2020, reflecting the versatility of the external trade sector in Hong Kong.

• Item Type: MPRA Paper
• Language: English
• Keywords: Hong Kong; Entrepôt; Re-Export; Sino-U.S. Trade War.
• Subjects: F - International Economics > F1 - Trade > F13 - Trade Policy ; International Trade Organizations; F - International Economics > F1 - Trade > F14 - Empirical Studies of Trade; F - International Economics > F1 - Trade > F16 - Trade and Labor Market Interactions

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