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MR MAUDE'S VISIT TO HONG KONG, 17-19 SEPTEMBER BACKGROUND BRIEF (p)The Hong Kong Economy
(brief provided by HKG)
1.
The rate of economic growth has been slowing
down, partly due to slower growth in demand for Hong
Kong's products overseas and partly because the economy
was already operating at full capacity. This trend is in
line with earlier predictions but is being accelerated by
the repercussions of the political turmoil in China.
Annex Fi
2.
The latest forecast of the growth rate of Hong
Kong's gross domestic product for 1989 is 5% (adjusted
from 6% in the Budget Speech), while in 1988 the estimated
growth rate was slightly over 78.
3.
In the external sector, there was a marked
slow-down in growth in Hong Kong's domestic exports
(growth rate in real terms over a year earlier: 11% in 4th
quarter 1988, 6% in 1st quarter 1989, 2% in 2nd quarter
1989) and re-exports (growth rate in real terms over a
year earlier: 48% in 4th quarter, 34% in 1st quarter 1989,
25% in 2nd quarter 1989).
4.
Concurrently there are indications that the
growth in domestic demand has also been slowing.
On
consumption expenditure, the growth rates of the volume of
retail sales and of retained imports of consumer goods
COMEDENTIAL