Hong Kong's total exports plus imports were HK$226.9 billion ($29.28 billion) in November 1998, against HK$257.72 billion ($33.25 billion) a year earlier, representing a 12-per cent decline in total trade flows.

Total exports, comprising exports of domestically produced goods and re-exports, fell by 9.3 per cent from a year earlier to $113.1 billion in November 1998.

Concurrently, the value of imports in November fell by 14.4 per cent from a year earlier to $113.8 billion.

The declines were more moderate than in October, which saw total exports dive 17.5 per cent from a year earlier and imports fall 22.4 per cent.

George Leung, economic advisor to Hongkong and Shanghai Banking Corp, said the figures showed continued weakening in fundamentals despite the moderation from October's steep declines,which were exaggerated by a high base in October 1997. He said the export outlook for the territory for December and the early part of 1999 was not encouraging.

"It is not possible for Hong Kong to achieve a strong recovery without a rebound in the export sector. So basically now we are in a situation that we can't finance our imports with our exports because there are no additional extra funds."

Hong Kong's Census and Statistics Department said on Monday that the territory's index of industrial production was 117.2 in the the third quarter, down 10.2 per cent from a year earlier.

The steepest declines were recorded in the miscellaneous manufacturing sector, down 24.7 per cent; the plastic products industry, down 19.2 per cent; fabricated metal products, down 19.2 per cent; and food, beverages and tobacco, down 15.8 per cent.

The government said the manufacturing decline was directly tied to the decline in exports, as well as continued movement of manufacturing operations across the Chineseborder.

In a statement, the government said the territory's slackened trade performance in November "was mainly due to the plunge in import demand in Japan and in other East Asian economies hit by the regional financial turmoil."

"More recently, exports to the conventional markets such as the United States and the European Union were also affected by the moderation in their import demand," the government said.

Hong Kong's exports to mainland China continued to fall, along with China's own exports.

For the first 11 months of 1998, total trade flows fell 9.0 per cent from a year ago to HK$2.555 trillion ($329.68 billion).

Hong Kong's visible trade deficit reached of $0.7 billion, versus HK$8.34 billion a year earlier and HK$0.72 billion in October.