an even faster rate of growth from the business sector. (Exhibit 2.4 highlights the fact that new business lines are growing faster than the number of business establishments. The ratio is widening, whereas the gap between new residential lines and the number of domestic households is narrowing).
the high growth in international telephone traffic
growth in value added services.
In 1971, 27% of exchange lines were business lines. This proportion declined to 23% in 1976 but then bottomed out. Since 1977 it has been on an upward trend and has reached almost 28% of the total in 1987 (or 0.51 million lines). The increase in business exchange lines as a percentage of the total can be explained principally by the change of Hong Kong's economic structure, particularly during the mid 1970s. Since that time Hong Kong has become an important regional financial centre with many overseas banks establishing local and regional offices. Hong Kong has also emerged as a centre for China trade since the start of the PRC's current modernization programme. Foreign companies use Hong Kong as a base for China trade because of its proximity and infrastructure facilities.
On a comparative basis, Hong Kong now has one of the highest penetration rates in the world of residential lines per 100 households. (See Exhibit 2.5). These penetration rates surpass those of the UK, Japan and Switzerland. After Australia, New Zealand and Japan, Hong Kong has achieved the highest level of network development in terms of exchange line density in South East Asia/Australasia. Throughout the past decade Hong Kong has achieved a relatively high rate of growth in exchange lines compared with the industrial nations (see Exhibit 2.6). Usage is also very high. It is difficult to measure precisely as there is no local call metering. However in 1987 the local call traffic reached an estimated 18,000 million minutes, equivalent to 26 minutes of call traffic per exchange line per day.
Public call offices and payphones
Hong Kong has one of the lowest levels of public call offices and payphones per 1,000 inhabitants in South East Asia. Japan has 7.54 per 1,000, Malaysia 0.75 and South Korea has 2.86 compared with only 0.3 in Hong Kong. This is principally due to the free local call system operated by HKT, which allows visitors and passers-by to use telephones in shops and restaurants for local calls. There are an estimated 20,000 such courtesy phones (3.51 per 1,000 inhabitants). A small number of shop owners have been attracted by the possible revenue sharing arrangement which local private coin phones offer. The number of private payphones installed is now 884 and the number of public payphones installed is 801. As well as public and private local coin phones, there are cardphones for IDD calls, IDD coin phones and (soon to be introduced) credit card phones.
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