香港總督官邸
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Sir,
ANNUAL REVIEW FOR 1978 HONG KONG
Introduction
THE OFFICE OF THE GOVERNOR
FLAGSTAFF HOUSE
HONG KONG
25 January 1979
1. I attach a calendar of events in 1978. In that year Hong Kong continued to expand as an industrial, financial, commercial and communications centre; it ma in ta ined its course of construction, reconstruction and social reform over a wide front and at great pressure. The results were satisfactory and even spectacular. But as the year progressed two problems in particular emerged. Firstly immigration from China climbed to levels that were completely unacceptable, and was aggravated by the arrival of refugees from Vietnam. Secondly, though buoyant in terms of growth and revenue, the trend of the economy became increasingly worrying. A major problem for 1979 will be how to reduce the growth of domestic demand sufficiently to get back to an export-led economy without damage to our long-term plans. But as 1978 drew to a close, in addition to problems of macro-economic management Hong Kong's attention was focussed on the hectic pace of change in China and its implications for the Colony.
China/United Kingdom/Hong Kong: British Exports
2.
We are fast approaching the time at which some move must be made with China about the future of Hong Kong. Political and commercial relations with China have steadily improved, and China's acknowledgement of the value to China of the existing administration in Hong Kong has never been more explicit. The Hong Kong Government has pressed on with programmes of social and economic development and organisation for their own sake but timed to achieve maximum prosperity,
The Rt Hon Dr David Owen MP Foreign & Commonwealth Office London SW1
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cohesion and contentment when the time for that move comes. But I have also been concerned at what might be the political implications at such a time of a visibly declining British commercial interest in the Colony. It also seemed absurd to waste such excellent export possibilities.
3.
Very great efforts have therefore been made to correct the decline that was so marked in the late 60s and 70s. The value of British exports to Hong Kong has now increased by 75% in two years, and in 1978 are expected to be about £360M. Since major contracts amounting to £300M were won by British firms in 1978 for later delivery this expansion should continue. I trust that efforts will be made to persuade the exporters who flock to China not to overlook Hong Kong. It has great potential not only as a selling platform for China and South East Asia, but as a market in its own right, with a built-in advantage for British exporters.
Police
4.
In 1978 we have been concerned that the mutinous situation that existed at the end of 1977, and the partial amnesty hastily brought forward to defuse it, should not set back the great strides made in the containment and reduction of both crime and corruption. For purposes of this review suffice it to say that all is going well. The power and effectiveness of the Independent Commission Against Corruption are unimpaired, and its working relations with the police have improved. On the other hand the success of the police in reducing serious crime has continued. The complete cure of the Force will take time; but time is on its side because the quality of the young intake into both constabulary and inspectorate over the past five years is high, the more dubious elements are gradually leaving, and there is an excellent lot of young officers at the mid-levels. Great assistance was given by a very thorough review of the Force undertaken by a Home Office team led by Mr Crane.
5.
In retrospect I am inclined to see the near-mutiny as a regrettable, violent and perhaps inevitable passage in the process of transforming the Force from a colonial militia into a modern constabulary - a process that has progressed far and fast.
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Immigration
6.
Legal and illegal immigration from China has steadily risen during the year. In spite of repeated representations the daily average of persons permitted to leave China rose from 90 a day in January to 310 in December, the total gain from this source being 67,500. In addition
In addition 8,200 illegal immigrants were intercepted and most were returned. Since probably only one in five were caught, one must reckon on a population gain from this source of 32,800, or 100,300 in all from China during the year. It is clear that there has been a degree of relaxation over the issue of permits and over movement generally in Kwangtung approaching loss of control. I should expect this situation gradually to improve as the Chinese authorities respond to our representations. If not, we will have to consider imposing controls in spite of Chinese objections.
7. But from Vietnam the prospect appears to be for more rather than less refugees afloat in the South China Sea seeking shelter wherever they can get it, including Hong Kong. During the calendar year Hong Kong accepted about 5,000 and at the moment of writing the accumulated total of Vietnamese here awaiting resettlement by the UNHCR is about 10,000. The rate of arrival of refugees by boat is about 1,000 per month and is expected to increase.
8.
Impossible as these numbers of Vietnamese are for Hong Kong against the background of the influx from China, they are small in comparison to the numbers confronting the United Nations High Commissioner for Refugees in the region as a whole. While a major international effort, including one by Vietnam, is clearly essential, the reluctance of potential host countries to act on the scale necessary is apparent. I fear Vietnamese refugees will represent a most intractable and emotive problem as this year progresses.
Social Programme
9.
In the social field this Government's aim is to achieve standards by the early or mid-80s that meet Hong Kong's special requirements and compare favourably with other developing countries in Asia. In 1978 we were on course. Very briefly the salient facts of an exceptionally busy year have been:-
(i)
Public Housing: Contracts let will achieve in 1979 housing for about 200,000 people. This is the level at which we have always aimed.
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