INDUSTRY AND TRADE
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overcome such barriers as exchange controls, quota restrictions and tariffs.
In 1962, the United States remained the largest market for the Colony's domestic products, taking 26 per cent by value. Pur- chases by the United States increased by nearly $200 million or 29 per cent; this was largely the result of a significant rise in the value of clothing sent to that market. Other important purchasers of Hong Kong goods were the United Kingdom, Malaya, Western Germany, Australia and Canada, but domestic exports were also sent to practically every country in the world. Commonwealth countries took 46 per cent of domestic exports by value, while America took 29 per cent.
An indication of the size of the entrepôt trade may be gained from the value of re-exports, which totalled $1,070 million. This represented an increase of eight per cent compared with_1961. Although re-exports to China remained considerable, being valued at $77 million, it was only the third largest purchaser of re- exports. The first and second were Malaya and Japan respectively. In recent years the entrepôt trade has been generally in the ex- change of products of Asian countries. The chief commodities entering the re-export trade were textiles, gems and jewellery, animal and vegetable crude materials, fruits and vegetables, medicinal and pharmaceutical products and machinery.
INTERNATIONAL TRADING PROBLEMS
Hong Kong's domestic exports in 1962 achieved a higher rate of expansion than in the previous year. This success was the more remarkable because trade during the year, particularly in cotton textiles, was carried on in an atmosphere of tension. This was occasioned by the operation of the Short Term Cotton Textile Arrangement and its application by the United States of America to 30 of the 64 categories of textiles, and by Canada to four categories. Further uncertainty was felt over the Colony's future trade as Britain moved toward joining the European Common Market.
The Hong Kong textile and garment industries have gained for themselves a reputation as being among the most efficient and