CONFIDENTIAL
機密
Summary of Major Developments in Hong Kong-China Economic Relations
in the fourth quarter of 1988
(paragraph references
follow those in the report)
CRC INF 7/89
(CEC 2/89)
(1) China's economy remained buoyant in the fourth
quarter of 1988 (paragraph 1). The growth rate in real terms of gross industrial output accelerated slightly in the fourth quarter, to 19% from 18%
(paragraph 3). For 1988 as a whole, the gross national product (GNP) increased by 11.2% in real terms while that of gross industrial output increased by 17.7% (paragraph 2). Rapid industrial growth since the fourth quarter of 1986 has exerted strong pressure on the bottleneck sectors and the physical shortage of materials is likely to reduce the growth momentum of the economy in 1989 (paragraph 6).
(2) The rate of inflation was high, running at about 26%
in the last three months of 1988 and the average for
1988 was at 18.5% (paragraph 9). But despite such a high rate of inflation, the forecasts for 1989 put forward by the State Council suggest that the Chinese leaders are loath to sacrifice growth for the sake of
price stability (paragraph 10).
(3)
China's visible trade deficits widened sharply in the
second half of 1988 as export growth slowed down but import growth was maintained at a high level. This
deterioration was at least partly related to
inflation (paragraph 11). But with an increase in
foreign investments (paragraph 13) and in earnings
CONFIDENTIAL
機密