THURSDAY, SEPTEMBER 30, 1982
FOUR PER CENT GROWTH IN GDP PREDICTED
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THIS WILL BE A YEAR OF SLOWER RATES OF GROWTH, LOWER INFLATION AND STILL HIGH LEVELS OF EMPLOYMENT+, THE FINANCIAL SECRETARY, MR JOHN BREMRIDGE, TOLD MEMBERS OF THE HONG KONG SOCIETY OF SECURITY ANALYSTS THIS (THURSDAY) EVENING.
SPEAKING ON THE STATE OF THE ECONOMY, MR BREMRIDGE SAID THE REVISED GROWTH RATE OF GDP FOR THE YEAR IS NOW FOUR PER CENT IN REAL TERMS, COMPARED WITH THE BUDGET FORECAST OF EIGHT PER CENT AND THE ACHIEVED GROWTH RATE OF 11 PER CENT IN 1981.
+ IN MAKING SUCH A CONSIDERABLE REVISION TO MY FORECAST I AM CONSOLED, THOUGH ONLY PARTLY, BY THE REALISATION THAT SIMILAR DOWNWARD REVISIONS HAVE HAD TO BE MADE BY OTHER FORECASTERS, BOTH IN HONG KONG AND ELSEWHERE, HE SAID.
+ IT IS WISE TO FACE THE FACTS SQUARELY, HE ADDED. +THEY ALSO REVEAL THAT MOST OTHERS ARE DOING WORSE, THOUGH THAT IS LITTLE CONSOLATION TO HONG KONG PEOPLE.
AND IF THIS FOUR PER CENT GROWTH RATE IS ACHIEVED, AT A TIME GENERALLY CONSIDERED BY ECONOMISTS TO BE THE MOST SEVEŘE WORLD RECESSION IN 50 YEARS, +OUR ECONOMY WILL HAVE DONE BETTER THAN IN THE LAST RECESSION IN 1974-75, WHEN WE RECORDED A GROWTH RATE OF ONLY TWO PER CENT FOR TWO YEARS RUNNING, HE SAID.
LOOKING AT HONG KONG'S LONGER TERM PROSPECTS, MR BREMRIDGE SAID THE INDICATIONS ARE THAT THE WORLD ECONOMY MAY BEGIN TO IMPROVE SLOWLY BUT STEADILY IN 1983.+
IT SEEMED PROBABLE THAT THE NADIR IN THE WORLD RECESSION HAD BEEN REACHED, BUT THE POSSIBILITY MUST EXIST IN THE WORLD AS A WHOLE OF FURTHER MAJOR FINANCIAL SHOCKS ARISING UNPREDICTABLY FROM BANKING, POLITICAL OR MILITARY EVENTS.
+ALL WE IN HONG KONG CAN DO IS GUARD OUR RESERVES, STAY NIMBLE ON OUR FEET, AND CONTINUE TO GUIDE OUR AFFAIRS WITH PRUDENCE.
+WITH A RELATIVELY DEFLATED INTERNAL COST/PRICE STRUCTURE AND SOME SPARE CAPACITY HONG KONG IS WELL PLACED TO BENEFIT FROM A REVIVAL IN EXPORT DEMAND AS OUR MAJOR TRADING PARTNERS START TO CLIMB OUT OF THE PRESENT RECESSION, HE SAID.
THE FINANCIAL SECRETARY OUTLINED A NUMBER OF REVISED FORECASTS FOR 1982.
DOMESTIC EXPORTS
TAKING A PESSIMISTIC VIEW QUITE DELIBERATELY, IT APPEARS THAT OUR EXPORT PERFORMANCE MAY REMAIN WEAK FOR THE REST OF THE YEAR, HE SAID. CONSEQUENTLY, DOMESTIC EXPORTS IN REAL TERMS ARE NOW FORECAST TO DECLINE BY TWO PER CENT, COMPARED WITH A BUDGET FORECAST INCREASE OF SEVEN PER CENT.
DRO TC