Hong Kong Manufacturing SMEs: Preparing for the Future

47Exhibit 33. Exports of Watches & Clocks from Hong Kong, HK$ millionsDestination2007 2008 2009Value Y-on-Y Change Value Y-on-Y Change Value Y-on-Y ChangeWorld 49,958 6.3% 55,204 10.5% 43,730 -20.8%United States 9,059 -3.9% 9,490 4.8% 7,096 -25.2%Mainland China 7,033 11.5% 7,937 12.9% 6,088 -23.3%Switzerland 5,374 23.9% 6,233 16% 5,228 -16.1%Source: Hong Kong Trade Statistics, Census and Statistics Department.Exhibit 34. Chinese Mainland Process Industry Watches and Clocks Re-exported from Hong Kong,HK$ millionsWatches and Clocks Re-export of Processing Products Manufactured in theChinese Mainland2006 2007 2008 2009Value 21,240 21,693 21,765 16,940Source: Hong Kong Census and Statistics Department.Exhibit 35. Imports of Watches and Clocks to Hong Kong, HK$ millionsSource2007 2008 2009Value Y-on-Y Change Value Y-on-Y Change Value Y-on-Y ChangeWorld 41,204 21.4% 47,994 16.5% 39,220 -18.3%Switzerland 15,904 45.7% 20,126 26.5% 16,321 -18.9%Mainland China 14,909 6.8% 17,382 16.6% 13,528 -22.2%Japan 5,431 4.8% 5,671 4.4% 4,670 -17.7%Source: Hong Kong Trade Statistics, Census and Statistics Department.200,000 people and produced 800 million watchesand clocks.By the end of 2008, there were 2,000 Hong Kongfundedwatch and clock and related accessoriesenterprises in the PRD.Issues for Hong Kong Watch ManufacturersHong Kong’s watch and clock sector is facing severalissues. These include the global economic downturn,powerful buyers, tough competition, RMBappreciation, labour availability, wage increases, andincreases in utility and material costs. Additionally,legal and regulatory changes regarding processingtrade, labour law, the environment, and safety havealso been implemented and must be managed.The downturn in the global economy that beganin force in September 2008 led to banks tighteningtheir credit terms for manufacturers, decreasedorders for watches, and increased business carryingcosts for the watch and clock sector as a whole. 101Trade credit and other lending for the industrylargely dried up for a period of time, making it verydifficult to operate, particularly for firms that hadnot set aside sufficient cash reserves.101 Hong Kong Watch Manufacturers Association.