THURSDAY, APRIL 9, 1981
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+THIS IS WHY I AM ENTIRELY OPPOSED TO ANY FORM OF SUBSIDY FOR PRODUCERS CR CONSUMERS (OTHER THAN, SO FAR AS THE LATTER IS CONCERNED, ON COMPELLING SOCIAL GROUNDS),+ HE SAID.
+THE FACT IS THAT, SOONER OR LATER, THE NEUTRALITY OF OUR FISCAL SYSTEM GENERALLY WOULD BE ERODED, FOR SUBSIDY PAYMENTS EVENTUALLY HAVE TO BE FINANCED.+
REFERRING TO A SUGGESTION BY THE HON S.L. CHEN FOR THE CREATION OF A FUND TO PROVIDE LOANS TO MANUFACTURERS FOR THE PURCHASE OF PLANT AND EQUIPMENT AT BELOW MARKET RATES, SIR PHILIP SAID THE EFFECT WOULD BE THAT THE CONTRIBUTION TO RECURRENT REVENUE OF EARNINGS ON OUR FISCAL RESERVES WOULD FALL WITH ULTIMATE CONSEQUENCES FOR OUR NARROWLY BASED TAX SYSTEM WITH LOW RATES OF CHARGE.
+MAYBE ONE OR TWO ARGUABLY ONE-OFF SUBSIDY PAYMENTS WOULD NOT BE THE END OF THE WORLD, + HE SAID, +BUT ONE-OFF PAYMENTS WOULD NEVITABLY BECOME ONE OR TWO ON-GOING SCHEMES AND ONE OR TWO
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-GOING SCHEMES WOULD INEVITABLY BREED OTHERS.+
SIR PHILIP ALSO DISMISSED CLAIMS THAT THE MANUFACTURING SECTOR IS 'FLAGGING'. THIS IS SIMPLY NOT BORNE OUT BY OUR EXPORT PERFORMANCE IN RECENT YEARS, HE SAID.
IT IS BECAUSE THEY HAVE + IF SOME INDUSTRIES ARE 'FLAGGING' CEASED TO BE COMPETITIVE FOR ONE REASON OR ANOTHER, HE NOTED.
IN ORDER TO PRESERVE OUR COST-COMPETITIVENESS AND FLEXIBILITY RESPONSE, SIR PHILIP FELT THAT MARKET FORCES MUST BE ALLOWED OPERATE ÎN SUCH A WAY AS TO DIVERT RESOURCES ELSEWHERE.
HOWEVER, HE NOTED THAT THE GOVERNMENT, WHICH STILL CONTRIBUTES NEARLY 27 PER CENT TO THE GDP AND EMPLOYS ABOUT 40 PER CENT OF THE LABOUR FORCE, WILL STILL HAVE A ROLE TO PLAY IN THE DIVERSIFICATION CF THE MANUFACTURING SECTOR.
ON THE HON WONG PO-YAN'S SUGGESTION FOR THE SETTING UP OF A CENTRAL BODY FOR PLANNING, CO-ORDINATION AND CONDUCT OF SCIENTIFIC AND TECHNOLOGICAL RESEARCH AND DEVELOPMENT TO MEET THE NEEDS OF THE INDUSTRIAL SECTOR, SIR PHILIP SAID THE ADVISORY COMMITTEE ON DIVERS IF ICATION HAS RECOMMENDED THAT THE PRODUCTIVITY COUNCIL SHOULD BECOME THE ORGANISATIONAL FOCUS FOR IMPROVING INDUSTRIAL SUPPORT FACILITIES, WHICH INCLUDE RESEARCH AND DEVELOPMENT.
+THE COUNCIL HAS PUT UP A NUMBER OF PROPOSALS, WHICH THE INDUSTRIAL DEVELOPMENT BOARD HAS CONSIDERED, OR IS CURRENTLY CONS IDER ING, COVERING VARIOUS SUPPORT FACILITIES, HE SAID, ADDING THAT BOTH ORGANISATIONS WERE STILL WORKING OUT HOW TO TACKLE RESEARCH AND DEVELOPMENT AND MR WONG'S VIEWS WOULD BE TAKEN INTO ACCOUNT.
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