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Industry and Trade
EXTERNAL trade reached record heights and Hong Kong's industrial and commercial sectors continued to expand in 1973. However, this growth must be viewed against a background of substantial world-wide inflation. Nevertheless trade increased in quantity as well as in value. The trade figures are satisfactory in view of the generally uncertain trading conditions created by the disturbed international currency situation, the increased protectionism and soft market conditions which continued to prevail in a number of Hong Kong's major markets. They are also satisfactory considering the vigorous competition offered by other exporting territories in the major markets.
Perhaps the greatest problem during the year for Hong Kong's traders and in- dustrialists was restricted supplies and high prices of many essential raw materials— notably petrochemical products, metal semi-manufactures and raw cotton. The inter- ruption in the free flow of oil from the Middle East towards the end of the year will create further supply difficulties for Hong Kong industry in 1974.
Many factors have contributed to give Hong Kong its international reputation as a leading manufacturing and commercial centre in Asia-among them, an economic policy of free enterprise and free trade, an industrious work force, a sophisticated commercial infrastructure, a modern and efficient seaport, a strategically located air- port, and excellent world-wide communications. Access to markets in North America and close traditional trading links with Britain have also boosted Hong Kong's prosperity.
Hong Kong is one of few territories still faithful to liberal economic policies of free enterprise and free trade. There are no import tariffs, and revenue duties are levied only in respect of locally manufactured or imported tobacco, alcoholic liq- uors and some hydrocarbon oils. Duty is also payable on first registration of non- Commonwealth motor vehicles.
Apart from provision of the infrastructure, either through direct services or by co-operation with public utility companies and autonomous bodies, the government's role in the economy remains one of providing a stable framework within which com- merce and industry can function efficiently and effectively with a minimum of inter- ference. The government intervenes only in response to the pressure of overriding economic or social needs. There is also no protection or subsidisation of manufactures.
In November 1973 the government set up two committees to help Hong Kong meet the threat of an oil shortage following the Arab oil-producing countries' decision to cut their output. The first of these is the Oil Policy Committee, under the Deputy Colonial Secretary, which oversees the general strategy towards oil supplies and