Li
'DE
2.
trade and exports.
5.
We have enjoyed the fruits of unprecedented economic growth and prosperity in the last decade as a result of the rapid expansion of our external trade. The pace is, however, slowing down due to various constraints currently at play, and there are signs of further dark clouds gathering. The United States is still by far our largest market (accounting for 42% of our domestic exports, worth HK$5,190 million). Thus the recent
world monetary crisis and the economic measures adopted by President Nixon to improve the American internal economic situation and balance of payments position are developments which we view with disquiet. Although the 10% import surcharge does not now apply to our exports of textiles and garments, it still directly affects about 60% of our exports to the United States. This, coupled with the current recessionary trend in the United States and the uncertainty and disruption caused by the labour troubles in west and east coast ports, seems likely to lead in the coming months to at least a significant slowing down in the growth of Hong Kong's exports to the United States. But the biggest threat without doubt, for some time, is the very unfavourable bilateral agreement for the restraint of exports of man-made fibre and wool textiles to the United States which we have just been forced to conclude. We had to negotiate under an explicit threat that import restrictions, on even less favourable terms, would be imposed in default of agreement and against a time limit set by Inited States domestic political considerations.