CONFIDENTIAL

Cammel.

Attention in Hong Kong is now focussing on the

second Harbour Tunnel Crossing, another large and

important

million.

project with a potential

The Hong Kong Goven rment

international consortia, two of whom include

UK content of £145

recently announced

that 3

British

and Lilley

companies (Trafalgar House Construction), have been short listed for this project.

4.

The balance of trade has traditionally been in Hong

Kong's favour. In 1984 United Kingdom exports accounted to £897 million whilst imports from Hong Kong totalled

£1,267 million.

During 1984 Hong Kong's exports of manufactured goods to the UK rose by 31% in value terms whilst our export of manufactured goods to Hong Kong rose by 23%. Clothing and textiles account

account for 35% of all of

imports from Hong Kong. This sector is Hong Kong's mo s t important and most sensitive internationally. During the period January to July 1985 UK exports rose by 16.8% to £583 million whilst during the same period

imports

Hong Kong increased by

million.

UK

from

7.6%

to £713

5. The UK has a 5.7% share of all foreign industrial

in investment

(together Hong Kong

the USA and Japan

account for 73%), but UK bank and service industries are

well represented.

6.

remain good although

Prospects for British suppliers remain good

the competitive advantage they enjoyed earlier this year has diminished with the strengthening of sterling.

CONFIDENTIAL

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