Hong Kong is poised to benefit from EU enlargement through lower import tariffs and greater demand for consumer goods, according to a study by the Hong Kong Trade Development Council.
The TDC’s report observed that prior to the accession of the ten mainly Eastern European states on May 1, tariffs on many products were higher than those levied by the EU. For instance, Poland placed an 18% tariff on the import of clothes and textiles compared to the EU’s 6.3% to 12% levy, whilst Hungary charged 15% to 25% on watches against the EU’s 4.5%.
However, these new member states will now have to fall in line with EU rules, and TDC assistant chief economist Daniel Poon estimated that on average, the tariffs will fall to 4% cent from 9%.
Poon observes that in the new member states “there is a huge domestic demand for affordable quality products which Hong Kong companies can produce efficiently.” However, he added that it is as yet unclear to what extent Hong Kong’s exports to the ten nations, which stood at $US1.064 billion in 2003, will be boosted by the tariff reductions.
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