1986-87. The main areas of Government spending include social and community services (health, education, transport), security (defence, police, immigration) and
economic and general services (ports
(ports and airports and
administration).
14. In the short term domestic exports are expected to
rema in weak. However, the recent devaluation of the
dollar has already improved Hong Kong's competitiveness
in export markets and this should result in increased
demand for Hong Kong products, although this also depends upon improved demand in Hong Kong's major markets. Economic growth could also be put at risk by
the growing clamour for trade protectionist policies
particularly in the United States.
Despite the
expansion of trading links with China, Hong Kong's
economic dependence on the US economy market remains very important. Given that the Hong
Kong economy is smal 1 and the territory follows a policy of free trade, the rise in protectionism (see
below) is a source of great concern to the Hong Kong
Government.
as an export
15.
Although the Hong Kong Government's earlier forecast of 7.2% economic growth in the territory during 1985 is now unlikely to be achieved, the economy
is still expected
expected to grow by a healthy 4.5% during the
rate expected
of growth is disappointing but judged by the standards of the major manufacturing economies remains high.
year.
The fall in the
PROTECTIONISM
16.
Hong Kong's economy
Over
are
heavily dependent
external trade. In 1984, the total value of Hong
Kong's external trade was 179% of its gross
gross domestic
product.
90% of Hong Kong's manufacturing
products
exported and the manufacturing directly employs 34% of Hong Kong's
i s
on
sector
labour force.
The