Trade relations
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51.
remains
Hong Kong's Longer term economic performance
dependent on external forces. The threat of protectionism in Hong
Kong's major export markets, particularly the United States, remains. While prospects for exports to China appear good in the
Longer term given China's modernisation programme, Hong Kong's domestic exports and re-exports to China have been affected by
tighter Chinese control on imports since April 1985.
52.
to
The Hong Kong Government will continue to make every effort counter protectionist pressures and to defend Hong Kong's trading interests. The past year has seen the satisfactory conclusion of several new agreements of vital importance to Hong Kong's textiles
These include the extension garments
of the
Multi-Fibre Arrangement until July 1991 and bilateral agreements textiles with the United States and with the European Community.
and
53.
industries.
A s from 23 April 1986 Hong Kong has been a separate contracting party to the General Agreement on Tariffs and Trade and, in that capacity, has supported the Launching of the Uruguay round of multilateral trade negotiations in November. In the forthcoming discussions Hong Kong willL lend particular support to efforts to bring about trade liberalisation and improved market
it has
considerable interest in negotiations on trade in services, a sector
of growing importance to the Hong Kong economy.
access:
(d)
Public Finances
54.
The Hong Kong Government budget returned to surplus in the
financial
1985/86 after year
three years of deficits. For the financial year 1986/87, higher yields from earnings and profits tax are expected, and the income from land sales will also be higher.
of present
trends
significant a
improvement
in
on the basis of
the
surplus is likely at the close of the current financial year. Nevertheless, the Hong Kong Government will continue to keep public
expenditure firmly
the
gross
sector,
control under
and
presently equivalent to
to contain
about 16%
of the size
the of
public domestic product. This will be achieved through prudent management
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