INDUSTRY AND TRADE
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development. The first years of the Second World War provided an additional stimulus, when locally made military and civilian supplies again partially replaced imports from overseas, and it is estimated that by the end of 1940 there were some 800 factories in the Colony.
Factory rehabilitation, after almost four years of enemy occupa- tion, was rapid, impelled by an acute shortage of consumer goods throughout war-scarred south-east Asia. The year 1949, when the influx of immigrants from China reached its peak, was a vital one for local industry. Most of the immigrants arrived destitute, but many brought capital and technical skills, both of which found ready employment in Hong Kong.
The Korean War and the resultant embargo on trade in strategic commodities with China drastically reduced the volume of Hong Kong's commerce. Only industrial expansion could offset the dangers threatening economic stability and provide employment for the Colony's greatly swollen and still growing population. Local industrialists reacted quickly to the new situation and, despite difficulties in obtaining certain raw materials, an increasing volume and range of Hong Kong products from many new and re- invigorated industries began to flow out to world markets.
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Today there are 7,305 registered and recorded factories employ- ing 297,897 persons (details are in Appendix I). At the census in 1961, 603,248 persons claimed to be employed in factory type operations, building construction and mining. Most industrialists are Chinese, although there are several important ventures owned and operated by non-Chinese or on a joint basis. Several overseas interests have also entered into licensing arrangements with local firms, authorizing the manufacture of products under internation- ally famous brand names.
Although no special benefits are available to industry by way of profits tax or protective tariffs, the general facility with which industry may be established and conducted in Hong Kong has proved attractive both to local and overseas investors. Apart from a very few revenue-producing duties, the Colony is a free port and Government regulation of trade is kept to a minimum.
The variety of goods produced by local industry is now con- siderable. In general, while the heavier industries such as ship- building and ship-breaking continue to be important, the Colony