WEDNESDAY, MARCH 28, 1979
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* THE SHORTAGE OF SUPPLY, AND SPECULATIVE PRICE INCREASES
OF VITAL INDUSTRIAL MATERIALS SUCH AS PLASTICS AND METALS ETC.
* THE RAPID RISE OF INTEREST RATES IN HONG KONG, FROM
4.75 PER CENT IN SEPTEMBER 1978 TO 11 PER CENT IN MARCH 1979, THUS GREATLY INCREASING OVERHEAD AND PRODUCTION COSTS.
* THE EFFECTIVE DEPRECIATION OF THE HONG KONG DOLLAR
TO AS MUCH AS FIVE PER CENT IN TWO MONTHS, MAKING IT DIFFICULT TO QUOTE FIRM PRICES AGAINST ENQUIRIES FOR FUTURE ORDERS.
* THE CHRONIC AND DETERIORATING LABOUR SHORTAGE THAT NOW RENDERS MOST FACTORIES UNDER-STAFFED BY AS MUCH AS 20 TO 30 PER CENT.
MR. WU SAID THESE ARE MAJOR PROBLEMS CONFRONTING LOCAL INDUSTRIES THAT WORK ON VERY CLOSE MARGINS, AND WHAT IS REALLY WORRYING IS THAT THE MANUFACTURING INDUSTRIES IN THE HONG KONG ENVIRONMENT HAVE NOT ALWAYS BEEN ATTRACTIVE INVESTMENTS.
+ONE ONLY HAS TO LOOK AT OUR STOCK MARKETS WHERE PROPERTY SHARES DOMINATE AND WHERE SPECULATION HAD BEEN FUELLED BY EASY MONEY AT LOW INTEREST RATE.
+WHILST THE RECENT RISE IN INTEREST RATE IS BEGINNING TO DISCOURAGE THE STOCK MARKET, ITS DETERRING EFFECT ON INDUSTRIAL INVESTMENT IS PERHAPS EVEN GREATER, IN VIEW OF THE SITUATIONS LISTED ABOVE.
+ IN THE MEANTIME, THERE ARE ATTRACTIONS SUCH AS CERTIFICATE OF DEPOSITS IN U.S., EURO OR ASIAN DOLLARS THAT YIELD TAX-FREE INTEREST RATES THAT ARE HIGHER THAN THOSE OBTAINABLE IN HONG KONG. 1 BELIEVED NO SMALL AMOUNT OF HONG KONG MONEY HAS GONE OVERSEAS IN THIS WAY ALONE AND SO ERODED THE EXCHANGE RATE, HE ADDED.
DIFFICULT AND IMPORTANT THE ROLE LOCAL INDUSTRIAL ISTS PLAY IN THE COMMUNITY, MR. WU CONTINUED, IT MAY NOT BE UNFAIR TO SAY THE IR VIEWPOINTS ARE SELDOM APPRECIATED AND ENCOURAGEMENT FORTHCOMING.
+ INDEED, HE ADDED, +GOVERNMENT OFFICIALS ARE SO USED TO THIS SO CALLED 'HANDS FREE POLICY THAT EVEN IN RECENT DIVERS IF ICATION COMMITTEE MEETINGS, A NEGATIVE ATTITUDE STILL SEEMED TO PREVAIL IN THAT MEASURES TAKEN AND PROVEN SUCCESSFUL BY OUR COMPETITORS GOT BRUSHED ASIDE WITHOUT MUCH SCRUTINY, AS THESE WERE CONSIDERED NOT RELEVANT AND IMPRACTICABLE IN THE HONG KONG SENSE.
+THUS WE DWELL OURSELVES IN COMPLACENCY, REMINISCENT OF HOW WELL WE HAVE DONE IN THE PAST, AND OBLIVIOUS TO THE PROGRESS MADE BY OUR COMPETITOPS WHO HAVE NOW OVERTAKEN US IN A BROADER INDUSTRIAL BASE AND IN TOTAL EXPORT VALUE AND THE IR GROWTH IS STILL SURGING FORWARD AT TREMENDOUS RATES.+
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