4.
Du this period, with overseas demand continuing to expand rapidly, domestic exports more than trebled (this being in quantity terms) and were equivalent in 1971 to as much as HK$ 17,500 million. The gross domesticproduct, which for 1971 was estimated at HK$21,000 million, increased, on average, over the decade by as much as 9% a year (this being in real terms, that is, after allowing for price increases). With the total population rising by some 2% per annum, this increase in the gross domestic product was equivalent to about 7% a year per head. For 1971, the per capita gross domestic product was esti- mated at more than HK5,000 (US$1000).
(a) Capital Investment and Wages
9.
Although there was a high rate of capital investment throughout the 1960's, the ratio of gross domestic fixed capital formation to the gross domestic product remained relatively low, at around 20% (much the same as today). This reflected the greater attractiveness of utilising the increasing supply of labour. During the 1950's, money wage rates had shown little tendency to rise, but with full-employment being achieved by about 1960 and with overseas demand for Hong Kong's products continuing to rise rapidly, money wage rates, even in the almost total absence of effective collective bargaining procedures, also increased markedly, by an average of around 15% a year. (And this was reinforced by significant improvements during the decade in Hong Kong's terms of trade the relationship between
G
its export prices on the one hand and its import prices on the other.) As a result, Hong Kong's wage rates have for some time now been the second highest in the region, after Japan's. But,
taking into account the relatively low proportion of the gross domestic product reprosented by fixed invostmont, it is unlikely that wages increased quite as rapidly as profits.
(e) Consumer Prices
10.
The increase in consumer prices was relatively modest throughout the 1960's, averaging 3% a year, As a result, the increase in wage rates was rapid, in real terms as well. Most of Hong Kong's inflation is imported: other than during the property boom around 1965,,when the building and construction industry became over-heated, and during the stock market boom in
/1973,
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