REVIEW
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of resolutions of the United Nations Conference on Trade and Development.
In other trade developments during the year the Cotton Textiles Arrangement, which covers over 80 per cent of Hong Kong's textile exports, expired on September 30. After a series of meetings of the Cotton Textiles Committee of the GATT the signatories of the Arrangement agreed to extend it for a further period of three years, that is until September 30, 1973. By the end of the year the majority of participating countries had signed the protocol of extension.
The five-year United States/Hong Kong Bilateral Agreement, under which exports of all cotton textiles to the United States had been restrained from 1965 to 1970, also expired on September 30. A new three-year agreement similar to the former one was negoti- ated in May 1970 in Geneva and became effective from October 1. The restraint limit for the first year of the new agreement represents an increase of five per cent over that for the last year of the old
one.
Hong Kong also negotiated an agreement with the European Economic Community to restrain exports from Hong Kong of certain cotton woven and knitted textiles for a three-year period beginning January 1, 1971. This agreement resulted from the imple- mentation of the Community's common commercial policy but is in essence a continuation of the restraint arrangements in force with individual Member States, with the addition that exports to Italy, which were previously unrestricted, were to be brought under control.
An announcement by the Far East Shipping Conference of a rise of at least 15 per cent (subsequently reduced to 10 per cent) in freight rates also caused concern to Hong Kong exporters during the year.
Despite these uncertainties, Hong Kong's economy continued to advance. There was indeed a sharp increase in business activity dur- ing the year which was reflected in an increase in bank deposits and in trade mark applications, while a record number of 3,419 new companies were registered during the year. A further indicator of the scale of economic progress was the 12.3 per cent increase in the consumption of electricity. Wages were estimated to be rising