INDUSTRY AND TRADE
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new investment. The merchant houses played a substantial part in this development. The first years of the second world war provided an additional stimulus, when military and civilian sup- plies produced in Hong Kong 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 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 stabilize the economy and provide employment for the Colony's greatly swollen and still growing population. 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 reinvigorated industries began to flow out to world markets.
Today there are 8,348 registered and recorded factories employ- ing 354,394 persons (for details see Appendix I). At the 1961 census, 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. Overseas interests have, to a growing extent, also entered into licensing arrangements with Hong Kong firms, authorizing the manufacture of products under internationally famous brand names, and into other forms of industrial co-operation.
Although no special benefits are available to industry by way of tax rebates or protective tariffs, the general facility with which industry may be established and conducted in Hong Kong has proved attractive both to investors here and overseas. Apart from a few revenue-producing excise duties, the Colony is a free port and Government regulation of trade is kept to a minimum.
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