THE HONG 10 BOOMORY
UNCLASSIFIEL
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1.
amufacturing is the major economic activity in Hong Zone,
accounting for hi of employi ent and 26. of total economic outį ut.
Trading activitio (including tourism, Lccount for 10, of employment
and 23% of output, financial and business services for 7. of employ-
ment and 20% of output, and construction for 7. of caployment and
6% of output. in 1970, the per capita Cur was 1,455, inflation Ex,
unemployment... and the average industrial wage hum 102 er month.
2. Les.ite ta pole economic base and underlying prosperity, the
MOI 101 ECOLORS D encountering certain roblem at the begining
of 1979. Iking. rosperity had led to increased contuler Bpcnding.
This, tupelit! with a tool in the construction industry, mad c:used
importa to ride blur 13 male divertim
export manufcctuling Stelar, ine vacible traut two
Werg TIGL. th.
in 1978, and the exchange rate of the The 101 doller tell. were
were indicat
tot & fully employed economy w... becoming over-
Leated, and inflationary pressures were building up.
3. In his budget for 1 introduced at the end of February, the
Hong Long Financial curetary proposed LeasuNCE to deal with these
problems: they included
ta
(i) & reduction in the rate of growth of government ca cnditure,
particularly on capital projects;
(ii) pl ded budget surpluses in viver to reduce the mülej su piy;
(iii) measured to reduce the credit-creatine potential of the
Government's own reserves; and
/(iv)