16
INDUSTRY AND TRADE
and digital watches-Hong Kong's exports are still highly concentrated in a few products as well as a few markets. Clothing, which is so far a major growth sector, alone contributed 44 per cent to the total domestic export value in 1976. Sales of miscellaneous manufactured articles-mainly toys and dolls, jewellery and goldsmiths' and silversmiths' wares, plastic flowers, umbrellas and metal watch bands-made up an additional 15 per cent. Exports of electrical machinery, apparatus and appliances- mainly transistorised radios, electronic components and parts for computers, tran- sistors, semi-conductor integrated circuits and diodes-accounted for a further 13 per cent. Textile yarn, fabrics, made-up articles and related products contributed nine per cent. Other light manufactured goods such as watches and clocks, metal products, travel goods, electronic calculators and footwear were also important exports.
The direction and level of Hong Kong's export trade is influenced principally by economic conditions and commercial policies in its main overseas markets. During the year, 63 per cent of all domestic exports went to the United States and the enlarged European Economic Community. The United States alone absorbed 34 per cent (32 per cent in 1975); West Germany took 12 per cent (13 per cent); and Britain 10 per cent (12 per cent). Other important markets were Australia, Japan, Canada, Singapore, the Netherlands and Sweden. Growth of exports to most of the members of the Organisa- tion of Petroleum Exporting Countries was also sustained in 1976.
Hong Kong's traditional entrepot trade remained steady at about 21 per cent by value of total exports. The principal commodities re-exported were machinery and transport equipment; textiles and clothing; diamonds; watches and clocks; crude animal and vegetable materials; medicinal and pharmaceutical products; and dyeing, tanning and colouring materials. The main countries of origin of these re-exports were China, Japan and the United States. Japan was still the largest re-export market, followed by Singapore, the United States, Taiwan and Indonesia.
International Commercial Relations
Hong Kong's external commercial relations are conducted by the Commerce and Industry Department within the framework of a basically free trade policy. Hong Kong practises to the full the rules of the General Agreement on Tariffs and Trade (GATT) and virtually the only restrictions maintained on trade are those required by international obligations. Most prominent among these are restraints on textiles exports to most major trading partners. These arrangements come under the umbrella of the Arrangement Regarding International Trade in Textiles, commonly known as the Multi-Fibre Arrangement (MFA). Britain acceded to the MFA on behalf of Hong Kong in 1974. A feature of the MFA is the Textiles Surveillance Body (TSB), which supervises the implementation of the arrangement. A Hong Kong representative sat as a full member in 1975 and as an alternate member to South Korea in 1976.
Following negotiations under the MFA, bilateral agreements were concluded during the year with Austria, Canada, Finland, Norway and Sweden. Under the terms of the agreements, exports of certain textiles from Hong Kong to these countries were placed under restraint.