WEDNESDAY, FEBRUARY 24, 1982
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MR BREMRIDGE ALSO SAID THAT IT IS ONLY ONE OF THE MANY DAMNATIONS OF INFLATION THAT IT BRINGS WITH IT UNDERSTANDABLE PUBLIC SCRATCHINESS AT CONSTANTLY RISING PRICES.
NEVERTHELESS IN A SITUATION IN WHICH OVERSEAS PRICES ARE RISING, THE HONG KONG DOLLAR HAS DEPRECIATED AND CREDIT EXPANSION HAS BEEN RAPID, SOME INCREASES IN DOMESTIC PRICES ARE INEVITABLE, HE ADDED.
+THERE IS HOWEVER ALWAYS SCOPE FOR THE INTERVENTION OF OTHER FACTORS THAT TEND TO KEEP PRICES DOWN, FOR INSTANCE ECONOMIES OF SCALE, USE OF COAL INSTEAD OF OIL, MANAGEMENT EFFICIENCY, CHEAPER OR ALTERNATIVE RAW MATERIALS, GREATER PRODUCTIVITY, AND SO ON.
+WE ARE FORTUNATE IN HONG KONG THAT BECAUSE PRODUCTIVITY IS RISING REAL WAGE LEVELS ARE NOW AGAIN INCREASING EVEN FOR UNSKILLED LABOUR, THOUGH IT IS A CLOSE RUN THING.
THE FINANCIAL SECRETARY SAID ALTHOUGH THE FIGHT AGAINST INFLATION IS A PRIORITY FOR THE HONG KONG GOVERNMENT AS FOR EVERY OTHER GOVERNMENT IN THE WORLD, WE HAVE NO PANACEA.
*THE GENERAL COURSE WE MUST CONTINUE TO TAKE IS OBVIOUS, BUT PARTICULAR CORRECTIONS MUST REFLECT HONG KONG CIRCUMSTANCES AND HONG KONG STYLE. ALL OF US HAVE OUR OWN PREDILECTIONS. GIVEN THE CHOICE, MINE INCLUDE A CONSCIOUS BIAS TOWARDS REASONABLY FULL EMPLOYMENT, + MR BREMRIDGE SAID.
REVIEWING OF OUR ECONOMIC PERFORMANCE LAST YEAR, MR BREMRIDGE SAID AMONG THE MORE OBVIOUS FEATURES WAS THE GOOD PERFORMANCE OF OUR DOMESTIC EXPORTS.
ALTHOUGH THE GROWTH RATE IN REAL TERMS OF 7.6 PER CENT IN 1981 REPRESENTED A CONSIDERABLE SLOWING DOWN COMPARED WITH 11 PER CENT IN 1980, IT WAS NEVERTHELESS ACHIEVED AGAINST A BACKGROUND OF UNFAVOURABLE ECONOMIC CONDITIONS IN ALL OUR MAJOR MARKETS.
+MOREOVER THE GROWTH RATE OF OUR DOMESTIC EXPORTS WAS CLEARLY ACCELERATING THROUGHOUT THE YEAR, REVERSING THE DECELERATING TREND DURING 1980 WHICH HAD CAUSED CONCERN, HE SAID.
HOWEVER, MR BREMRIDGE SAID IT WAS CLEAR THAT IN 1981 THE IMPETUS TO ECONOMIC GROWTH CAME MORE FROM DOMESTIC DEMAND THAN FROM EXPORTS.
PRIVATE CONSUMPTION EXPENDITURE GREW BY 10 PER CENT IN REAL TERMS- GOVERNMENT CONSUMPTION EXPENDITURE (INCREASED BY THE FRONT END LOADING OF OUR CONTRIBUTION UNDER THE REVISED DEFENCE COSTS AGREEMENT) GREW BY 25 PER CENT AND OVERALL INVESTMENT GREW BY 13 PER CENT.
BUT AT 11 PER CENT THE GROWTH RATE OF DOMESTIC DEMAND WAS NOT SO RAPID AS TO HAVE CREATED ANY IMBALANCE BETWEEN DEMAND FOR OUR DOMESTIC RESOURCES AND THE SUPPLY OF THEM, HE SAID.
+THE GROWTH RATE OF TOTAL FINAL DEMAND (EXCLUDING RE-EXPORTS) AT NINE PER CENT WAS ACTUALLY LESS THAN THE GROWTH RATE OF THE GROSS DOMESTIC PRODUCT AT 10 PER CENT AND SO IMPORTS WERE NOT BEING SUCKED IN AT A DISPROPORTIONATELY RAPID RATE.
/+THE GROWTH