During the year an Interim Mining Committee has been sitting to produce a Prospecting Licence and to revise the Colony's Mining Laws and Regulations. The issue of the Prospecting Licence should see an increased activity in local. mining.
INDUSTRIAL PRODUCTION.
The main range of industrial production in Hong Kong has been briefly indicated in the introduction to this chapter. Engineering and ship-building are, with one or two minor exceptions, the only heavy industries, and the bulk of the Colony's production is in the light industry field. It is almost entirely in Chinese hands, most of the factories being Chinese- owned and managed.
The outbreak of war with Germany had a stimulating effect on the Colony's industries particularly in the larger dockyards and in those local factories which were able to undertake the manufacture of war equipment. During the war against Japan, industrial activity was brought virtually to a standstill. By the end of 1946, the recovery of productive capacity had reached some 20-50% of pre-war levels although certain industries had not been so fortunate (for example, the important sugar-refining industry whose plant was a total loss), while others, such as paint manufacture, were experiencing a boom. During 1947, a general improvement continued but industry was still handi- capped by loss of equipment, lack of raw materials, the high cost of raw materials, fuel and electric power, and the very high cost of labour. Variations in production have been con- siderable, particularly in the textile, rubber shoe, electric hand torch, battery and bulb industries. Apart from the irregularity of supplies of raw materials, these variations are attributed to such factors as restrictions on the import of certain goods into China, devaluation of Chinese currency, foreign competition and political disturbances in Siam, French Indo-China and the Netherlands East Indies. In spite of these difficulties, progress was made. New factory-type premises are being built, old plant is being reconditioned and a number of firms have installed new machinery. Although delivery of new equipment from abroad was still subject to delays and none of the expected reparations from Japan have materialised, much was done locally to improvise the repair and re-assembly of equipment. Plant was brought in from Shanghai and machinery of certain types was manufactured by local foundries. Many raw materials continued to be scarce throughout the world and while the cost of local materials tended to decline, imported materials showed a tendency to increase in price. Labour costs remained high both in relation to costs prevailing before the war and to the current cost of labour in other manufacturing centres, but a substantial improvement in the efficiency of labour in some spheres-notably stevedoring-was observed. It is difficult to estimate with any accuracy the increase in industrial activity, but during the year under review the number of registered
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