CONFIDENTIAL #3
10-
19.
Hong Kong's investment in the SSEZ is mainly in manufacturing, property, and tourist facilities. There are at least 700 investment projects and many more contractual agreements on outward processing by Hong Kong
industrialists in the SSEZ alone. A large number of these
are subcontracting arrangements whereby certain
manufacturing processes are performed in Shenzhen and the
rest in Hong Kong. These projects range from textiles and
clothing through electronics, toys and other consumer
items, to a steel rolling mill and food and beverage
production. However, it is a fair comment that most
industrial establishments in the SSEZ are labour intensive
rather than technology or skill intensive and are in many
cases little more than the outward processing plants of
companies based in Hong Kong. Besides manufacturing, the
construction of many commercial and residential buildings
including hotels has been financed by Hong Kong investors.
20.
(b) China's investments in Hong Kong
In recent years, besides stepping up activities
in those areas where they traditionally had interests,
PRC-based companies have also moved into property, finance
(such as stocks, shares, gold, and foreign exchange), and
manufacturing which they had, for one reason or another,
previously refrained from entering. According to an
informal report, the PRC invested as much as US$4 billion
in Hong Kong during the five years 1979 to 1983. This
investment was undertaken by 50 PRC trade and
representative offices in Hong Kong and more than 300
projects were involved. In 1984 and the first half of
1985, it appears that China's investment in Hong Kong has
become increasingly more diversified.
CONFIDENTIAL #5