G.F. 326
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69.
This development scenario could, however, lead
to sectoral problems, particularly for Hong Kong's manufacturing industries. Industries using less skill-intensive and more land-intensive processes would face increasing competition, and some of them might become uneconomical. In those industries, factories and production processes are increasingly likely to be relocated across the border, resulting in a loss of
employment opportunities in Hong Kong. In view of the fact that about one third of Hong Kong's labour force works in the manufacturing sector and that a substantial number of other jobs are dependent on this sector's performance, any damage to its prospects would imply problems of economic dislocation and adjustment, particularly if the changes involved took place rapidly. Rather than having sustained unemployment, a likely consequence would be that real wages in the manufacturing
sector would fall relative to those in the services
sector. As this occurred some of the jobs in the manufacturing sector would be restored, while part of the workforce would shift to the services sector. However, in view of the difference in skills and experience required for different jobs, changes in employment would not be smooth in all cases, and the adjustment process could be difficult. Older workers with limited or specialised skills would be a particular problem.
70.
At a city-to-city level, Hong Kong is likely to become a strong competitor of Guangzhou in the provision
of business, financial and communication services to the
towns and counties in the Pearl River Delta region (traditionally, Guangzhou is the centre for such
services). The emergence of Hong Kong as the financial/commercial capital of the region in the longer term is not unlikely. On the other hand, Guangzhou could well become the dominant city in terms of manufacturing
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