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CONFIDENTIAL # 3

6

Hong Kong's imports from:

1st half of 1984

1st half

of 1985

% change

(HK$Mn)

(HK$Mn)

China

26,911

25,666

-5

Japan

24,553

27,644

13

United States

11,559

11,585

0

Source: Hong Kong Trade Statistics

About 61% of the goods imported from China in the first

half of 1985 were subsequently re-exported elsewhere. Re-exports of China origin to the rest of the world accounted for 30% of Hong Kong's total re-exports. China

has long been the largest source of goods re-exported

through Hong Kong.

11.

Analysed by products, most categories of imports from China into Hong Kong showed decreases in the first

half of this year. Only miscellaneous manufactured articles, textile fibres, travel goods and handbags, and telecommunication and sound recording and reproducing apparatus and equipment recorded some growth.

12.

As a consequence of the very rapid growth in

domestic exports and re-exports to China and the decline

in imports from China, for the first half of 1985 Hong

Kong recorded a visible trade surplus with China of HK$6.9

billion, the first such surplus with China since 1951.

PONEIDENTIAL

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