Macau Opinion | Trade stats

Trade statistics on goods for October indicate strong growth in goods exports. Compared with the same month last year, they were up by almost a third. It surely seems a significant figure but is not enough to suggest the local manufacturing industry is making a recovery

Manufacturing and, in particular, textiles, had an essential role in this economy in the late 20th century. A return to a similar status in the coming years or even a significant weight in the overall economy is unlikely.

It was a different context. China was not the international trade power it has become and was not a member of the WTO (or, before 1995, the GATT). More than that, it is difficult to see where the local competitive strong points would lie, or what opportunities would drive such a ‘renaissance.’

As it happens so often, isolated figures are inadequate for too much speculation. A single data point, no matter how much impressive it may look, is seldom meaningful. Just a look at the trade data for the first ten months of the year will suggest that, if anything, a long-term declining trend keeps going on.

It is still true that cumulative figures up to October show growth in merchandise exports of 8 percent, compared with the similar period last year. However, such growth is driven by re-exports, not domestic exports.

Or, as we might put it another way, by exports of foreign goods, not exports of goods produced locally. While the first grew by almost 12 percent, the latter went down by more than 12 percent.

If we look further back, the pattern is the same. Occasional rising figures for domestic exports do not block a general, well-defined and steady downward trend. For most of the last decade and further away, the rise in exports of goods meant essentially rising re-exports.

The weight of these in total exports has in even been growing. In the same period of ten months, re-exports amounted to almost 85 percent of total exports. That share has been going up steadily from the values recorded ten years ago, which were set around 60 percent.

By definition, re-exports did not suffer any transformation in their transit through Macau. There are indeed good reasons why the region may function as a convenient export platform for goods produced elsewhere. That does not mean a new spring is coming to manufacturing.