UNCLASSIFIED
UK EXPORTS TO HONG KONG
Total value of Hong Kong imports in 1980 was HK$111.6 billion (about £ sterling 10 billion). Of this figure, the UK supplied about HK$5.5 billion (ie. 4.9% and down from the 5.1% in 1979). However, Hong Kong re-exported about 26.9% of her imports and the UK share of retained imports rose slightly to about 6.68%. This better reflects the dramatic rise in UK exports to Hong Kong in sterling terms from & sterling 204 million in 1976 to £ sterling 559 million in 1980 (a rise of 173% in four years). In 1980, the UK exported about 94% as much to Hong Kong as to Japan (£597 million) and three times as much to China (£169 million).
2. About half of UK exports to Hong Kong were machinery and transport equipment (approximately £281 million). Some of this (about 30%) is accounted for by the power station and mass transport projects but the rest represents exports of general electrical and mechanical engineering equipment and road vehicles. Our success in large projects has attracted attention to this sector and we supply about 14% of Hong Kong's market for capital goods.
3. The total Hong Kong market breaks down into raw materials (42%), consumer goods (26%), capital goods (14%), foodstuffs and fuels (18%). Discounting the last, we could do better in the major raw material sector (UK share 3.7%) and the consumer goods sector (UK share 5%) of this shop-window for Asia. Particular target should be quality textile fabrics for Hong Kong's major clothing industry which imports total fabrics worth about £750 million per annum. Other new priority targets are construction
and electronics.
4. Our overall export performance is much improved and we are holding on to sixth place in the market exporting nearly twice as much as Switzerland and West Germany, our nearest European competitors, but a long way behind Japan and the United States. We need to watch the growing value of Hong Kong's re-export trade (57% of which is regional), expecially as Hong Kong entrepreneurs continue to develop small but numerous manufacturing ventures in Guangdong Province. At the moment Hong Kong with its population of only just over 5 million, is nineteenth in the league of Britain's export markets and our second largest market in Asia.