Hong Kong’s trade deficit widened to HK$37.9 billion in March, according to government data released Monday, exceeding market expectations. Economists had predicted a deficit of around HK$28.5 billion.

The Census and Statistics Department reported that the value of total exports of goods increased 2.6% year-on-year to HK$297.7 billion. However, this growth was outstripped by a 9.8% surge in the value of imports of goods, which reached HK$335.6 billion.

A government spokesman stated that the trade deficit widened further in March, but that export performance showed some improvement. He cautioned that the external environment remains challenging and will continue to affect Hong Kong’s trade performance in the near term.

Here’s a breakdown of the key figures:

• Total Exports: HK$297.7 billion (up 2.6% year-on-year)
• Total Imports: HK$335.6 billion (up 9.8% year-on-year)
• Trade Deficit: HK$37.9 billion

The widening trade deficit adds to concerns about the health of the Hong Kong economy, which is facing headwinds from slowing global growth and increased regional competition.