6
PART 1 INTRODUCTION
in 1965 that it accepted the data in the Household Expenditure Survey and Con- sumer Price Index as indicating an increase in the cost of living of some 14% between 1958 and 1965. This compared with figures collected by the Labour Department of the Hong Kong Government indicating an average increase in wage rates in certain sectors of manufacturing industry of 73% over the same period.
31. Nevertheless, it is clear that there was some slowing down in the hitherto rapid rate of growth of the economy in 1965 and that public confidence was affected by a banking crisis and a recession in real estate. These worries about the economy form a prominent part of the comment in subsequent chapters of the report and it is not proposed to dwell on them here, other than to show that there were domestic reasons for public concern about the economy as well as the usual external ones. The latter arise from the dependence of the economy on the export to a limited number of markets of a limited number of products in an international atmosphere of quotas and controls and on the tourist trade which is sensitive to factors such as the Vietnam War.
32. The Society. The insecurity of the international political situation in which Hong Kong exists is a matter apparently more frequently commented on by visitors than by residents-and the residents' apparent indifference to this situation is itself a subject for comment. However, this apparent indifference would seem to arise more from feelings of optimism and of an inability to influence the situation than from a failure to appreciate its realities.
33. The 1961 census found little distinction between new-comers and long- time residents of Hong Kong in their ability to find work, and this seems to reflect a lack of prejudice in the community. This attitude generally extends also to relations between the races in Hong Kong, although there is evidence of mis- conceptions on both sides.
34. Nevertheless, it is obvious that Hong Kong is not a single community in terms of accepted traditions and values. This concept is also reflected in the description of Hong Kong as 'an economy; not a nation'. Various factors pointing to a certain lack of cohesion in our society will be discussed in later parts of this report.
35. The reasons for an inquiry. It is obvious that the pressures due to overcrowding in the twin cities of Victoria and Kowloon, combined with the hard struggle for a living, which is increased by the need for many of the population to assist families in China in addition to their own dependents in Hong Kong, the lack of homogeneity in the population and the underlying insecurity of life in the Colony, resulting from international political and economic conditions, create tensions which elsewhere would be more than sufficient cause for frequent disturbances.