R&PA. 109
American File
Defensive Note for Mr. STANS' Visit
Developing Status of Hong Kong
ir. Stans may argue that Hong Kong is not a developing country. Hong Kong's claims to Developing Status are summarised below.
a) There are numerous precedents of instances where Hong Kong has been classified as developing e.g. in the U.N. Statistical Classification, #orld Bank, G.A.T.T., E.C.A.F.E., O.E.C.D.
b) Hong Kong's per capita income (approx £180 = ZU8432) 18 below that of a number of unquestionably developing countries.
c) Hong Kong has not got a highly diversified and sophisticated Industrial base. Hers can only be considered a developing manu- facturing economy, concentrating on a felatively small range of producte for export, mainly in light consumer goods.
a) Certainly a number of her products, notably textiles, are competitive in world markets, But competitiveness is a relative phenomenon; it may change. often in fact Hong Kong's competitive- ness has been exaggerated, as comparative figures with some other "developing" countries show.
•) Developing status must be accorded on the performance of the whole economy and not on the relative successes or failures of some sectors, Hong Kong's overall level of productivity is not high. Nor are her living standards.
Hong Kong Department
24 April, 1969