Budget
land sales.
This is raised by direct
In 1978/79 total Government Revenue was $12.5bn. taxation (34%), Indirect taxation (29%) and other sources - mainly income from properties and investments (37%). Expenditure on social services accounts. for 43% of Government expenditure. There are large housing projects on hand within the community.
Exports
Main exports are textiles and clothing (HK$24.1bn in 1979) and electrical equipment (HK$9.3bn in 1979). Main customers are USA (33.6%) GFR (11.3%) and UK (10.7%). Latest trade figures indicate a continuing high growth rate of exports with little sign of the recession in Hong Kong's major markets having any effect.
Imports
Main imports are raw materials and semi-manufactured goods (44% in 1979). Leading suppliers are Japan (22.5%) and China (17.6%). The UK is Hong Kong's sixth largest supplier (5.1%). The Government has attempted to reduce imports, particularly consumer goods in order to control a widening visible trade deficit. Deficit for the first 5 months of 1980 was HK$7.2bn and the forecast deficit for 1980 is HK$14.95bn. This is a 42% increase over 1979 but is in line with that estimated in the budget.
Reserves
Hong Kong does not publish complete balance of payments figures but has generated strong reserves through its trading and financial activities. At the end of 1978-79 reserves stood at HK$11.7bn. ?
Investment
Main pubic investments are on housing, power and communications.
The Hong Kong
Mass Transit Railway (MTR) has recently been partially completed to provide an efficient public transport system within the colony. Foreign investment in industry is increasing.
External Debt
There is virtually no public sector external indebtedness.
Medium term debt by
private sector borrowers is mainly related to the mass transit scheme and the power industry.
Energy
Hong Kong has no natural energy supply and is dependent upon imported oil and mineral fuels for energy supplies. In 1979 these formed 5.7% of the colony's import bill.
Outlook
There seems little likelihood of any direct intervention by China in the running of Hong Kong's affairs and we can expect business confidence to remain high. Economic outlook indicates continued growth through exports though trade deficits may mean a slower rate of growth. However Hong Kong is likely to remain a good market for ECGD.
2
•
*