G.F. 326
CONFIDENTIAL # 3
Report on Developments in
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Hong Kong China Economic Relations
third quarter of 1986
General economic developments in China
The Chinese economy showed signs of picking up
momentum in the third quarter of 1986. The value of
industrial output, at Rmb 223.6 billion (at constant 1980 prices), was 8.8% higher in real terms than in the same period last year. In the first and second quarters, the growth rates were 4.4% and 5.3% respectively. For the first three quarters as a whole, the value of industrial output amounted to Rmb 652.1 billion, representing 72.7% of the annual target and was 6.4% higher in real terms
than in the same period last year. In respect of
agriculture, grain production is expected to show an increase this year and the total value of agricultural output for the year as a whole is forecast to grow by 4%
in real terms.
2.
1
Within the industrial sector, heavy industries
began to grow faster than light industries, reversing the situation in 1985 when industrial production shifted in
favour of the latter. In the first three quarters of
1986, the output value of heavy industries rose by 7% to Rmb 329.7 billion while that of light industries by 5.3%
to Rmb 322.4 billion. The corresponding growth rates for heavy and light industries in the third quarter were 9.6% and 7.9%. Concerning the performance of individual industries, certain consumer items such as refrigerators and watches showed substantial growth in output while
others like automobiles, television sets and radios experienced declines. Production of certain types of machinery and equipment including computers and tractors has also slackened. Over the same period, the output of
industrial raw materials like pig iron and steel grew
CONFIDENTIAL ##