INDUSTRY AND TRADE
Textiles
Bilateral agreements negotiated under the MFA govern Hong Kong's textiles exports to Austria, Canada, the European Economic Community (EEC), Finland, Norway and the United States of America.
During the year, representatives of the governments of Hong Kong and the United States of America met to discuss bilateral and international co-operation to control and eliminate illegal trans-shipments of textiles. Both governments agreed to continue their mutual efforts to address the matter.
The bilateral textiles agreement with Canada expired at the end of 1993. In October, Hong Kong and Canada agreed to extend the agreement for two years up to the end of 1995.
Both the bilateral textiles agreements with Finland and Norway expired in December. Consultations with Finland in September resulted in a new Hong Kong/Finland textiles agreement extending the current agreement for a maximum of two years from January 1994 to December 1995. Following consultations with Norway in October, Hong Kong secured a new Hong Kong/Norway textiles agreement, also extending the current agreement for a maximum of two years from January 1994 to December 1995. The new agreements represent improvements in market access over the previous agreements. They will be automatically terminated upon the entry into force of the Uruguay Round agreement on textiles and clothing.
Non-textiles Issues
Anti-dumping investigations against Hong Kong companies in respect of 3.5-inch magnetic floppy disks, initiated by the European Community (EC) in September 1992, are still in progress. The Hong Kong Government considers that there is insufficient evidence of dumping, injury and link between the two for initiation of investigation, and submitted two representations during the year to the EC, seeking termination of the anti-dumping proceedings.
The relatively uncertain developments in trade relations between the United States of America and China continued to cast a shadow over Hong Kong's economic well-being. The areas of concern include, among other matters, the uncertainty of the renewal of China's Most Favoured Nation (MFN) trading status and the trade sanctions against China on the latter's alleged missile-related technology transfer to third countries. On May 28, 1993, China's MFN trading status in the USA was renewed for another year by an Executive Order of the President, Mr Bill Clinton. The order provides that in 1994, the US Secretary of State shall not recommend extension to the President unless he determines that the extension will substantially promote the freedom of emigration and China is complying with the 1992 China/USA agreement concerning prison labour. The Hong Kong Government and the private sector will continue to emphasise to the United States administration and members of Congress the adverse effect on Hong Kong's economy of the withdrawal of China's MFN status, or imposition of conditions on its renewal.
In August 1992, the South Korean authorities initiated an anti-dumping investigation against Hong Kong companies in respect of phosphoric acid originating from China and re-exported from Hong Kong. Final anti-dumping duties on the goods in question were imposed for a period of three years with effect from February 20, 1993.
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