response from operators of middle and small-sized factories is
Besides, the current research particularly disappointing. studies and existing support facilities relate mainly to the established industries. Obviously, the Government is not taking positive measures to introduce new industrial items and
If expand the industrial base so as to diversify our industry. the situation does not change, the economy of Hong Kong will continue to depend on the performance of domestic exports and our economic growth will be determined by the demand of buyers in our overseas markets. It implies that we will have to constantly compete with our rivals for the overseas markets. However, as we all know, we are gradually losing our advantageous position to our competitors in the Asian Region in terms of production cost, foundation for scientific research and Government assistance. Hong Kong will find itself in an increasingly difficult situation.
4.
Sir, I fully support the appeal made by the Hon Stephen CHEONG during last year's Budget Debate that it was the right time to review our policy on industry. Not only should the Government inform this Council what measures have been taken over the past years, it should also appraise the effects of these measures and see whether they are still applicable in
Since the the years to come or if they need to be improved. completion of the Report of the Advisory Committee on Diversification in 1979, there have been a number of
significant changes. For instance, with the closer ties between Hong Kong and China, it is very common for businessmen in Hong Kong to set up processing factories in the mainland and it is also possible to run projects in conjunction with scientific research units in China. There is a rise of protectionism in world trade. The progress made by our trade competitors and the expansion of the local service sector that I mentioned earlier on are all new developments that the Government should take account of in reviewing the existing policy and formulating its future policy on industry.