CONFIDENTIAL#2
16
quantify!
6.4.
So taking both these difficulties, the time
and hazards involved in diversifying industry and the
limitations on finding alternative markets, into
account, the consequences of any significant and sustained cut-back in exports to the EEC must be treated
as long terin. For planning purposes, the Hong Kong
Government has been assuming a 7% growth of the gross
domestic product in real terms into the early 1980s. For
the growth in practice to be between 5% and 6% will affect
the Government's ability to implement for example its
social programmes within the timetable it has set itself,
a timetable for which the uncertainties likely to develop
in the mid 1980s are relevant. The inability to meet
the programmes would not simply be the result of the lower
growth in public revenues deriving from a slowing down in
the growth of the gross domestic product. A more significant
factor would be the general lowering of horizons and lack
of business confidence, with consequences for investment
decisions, resulting from a sustained failure of the
economy to grow as expected.
Government Secretariat
Hong Kong
2nd September 1977
5.