PTZABR(3)

CONFIDENTIAL

Background

1.

Emigration is becoming an increasingly important issue in Hong

Kong, and a cause of major concern in banks and other financial

enterprises in the territory. The Governor acknowledged at a press conference last month that emigration is a problem. There is no clear cut evidence available, but the following picture has

emerged:

(a) the Hong Kong Government do not keep data on emigration, but

from available information the net outflow from Hong Kong was

about 20,000 a year between 1980 and 1984. In the last three

years the figures have been roughly:

1985

11,000

1986

13,500

1987

27,000

Indications are that the 1988 figure will continue at least at

the 1987 level.

(b) there is some evidence that an increasing number of those

leaving are from the professional/middle management area. The financial sector is particularly hard hit.

(c) there are no reliable data on those who subsequently return to

Hong Kong. Some people assert that only 10-20% return.

2. The Hong Kong Government have set up a task force to examine

the problem. The Governor has ruled out taking direct measures to

stop people leaving: the Hong Kong Government will continue to work

to make Hong Kong an attractive place to stay in or to return to, and will make every effort to train additional people to fill any

gaps. Other measures which have yet to be considered could include

establishing centres in major emigration destinations to facilitate return to Hong Kong, and addressing concerns that people returning may have about the education arrangements for their children in

Hong Kong.

3.

It is clear that the increase in numbers leaving Hong Kong has much to do with the more liberal immigration regimes introduced by

CONFIDENTIAL

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