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WEDNESDAY, OCTOBER 24, 1984
GRAVE THREAT SEEN FROM U.S. TEXTILE RULES
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THE NEW UNITED STATES CUSTOMS REGULATIONS ON TEXTILES AND APPAREL, COUPLED WITH THE STRENGTH OF THE U.S. DOLLAR, COULD DENT HONG KONG'S PROSPECTS FOR FURTHER ECONOMIC GROWTH, THE HON STEPHEN CHEONG SAID TODAY (WEDNESDAY).
SPEAKING IN THE LEGISLATIVE COUNCIL, MR CHEONG SAID, IF CARRIED OUT IN FULL WITHOUT SENSIBLE AND REASONABLE MODIFICATION+, THE NEW CUSTOMS REGULATIONS WOULD THREATEN THE VERY VIABILITY OF HONG KONG'S TEXTILES AND APPAREL INDUSTRY.
IN THE SHORT TERM, IF IMPLEMENTED WITHOUT MODIFICATION, THE REGULATIONS WOULD HAVE THE EFFECT OF WIPING OUT THE KNITWEAR SECTOR OF THE CLOTHING INDUSTRY, WHICH EXPORTED ABOUT HK$3.5 BILLION WORTH OF BOTH RESTRAINED AND NON-QUOTA KNITTED PRODUCTS TO THE U.S. EASILY THE SECTOR'S LARGEST MARKET.
+MORE IMPORTANTLY, THE KNITWEAR SECTOR PROVIDES 60 000 JOBS WHICH, IF LOST, WOULD PRESENT SHORT TERM SERIOUS DISLOCATION PROBLÉMS FOR SOME 200 000 PEOPLE, ASSUMING EACH WAGE EARNER SUPPORTS IN VARYING DEGREES ONLY THREE PERSONS IN THE FAMILY,+ HE SAID.
IN THE LONGER TERM, MR CHEONG SAID, THE EFFECT OF THESE REGULATIONS MIGHT BE EVEN MORE INSIDIOUS AND FAR REACHING.
+THE REGULATIONS REQUIRE EVERY MANUFACTURER TO DECLARE IN GREAT DETAIL, ON THE SPECIAL CUSTOMS INVOICE, THE STEPS INVOLVEL IN THE MANUFACTURE OF THE GARMENT, AND THE PRODUCTION COST OF EVERY MANUFACTURING PROCESS.
+THAT MEANS THAT OUR MANUFACTURING COSTS WILL BE KNOWN TI OUR CUSTOMERS.
+THIS WOULD LEAD TO REDUCED PROFIT MARGINS FOR OUR MANUFACTURERS, TO A REDUCTION OF OUR MANUFACTURERS' ABILITY TC REINVEST, TO A GRADUAL EROSION OF OUR EXPORT COMPETITIVENSSS ANI TO A POSSIBLE COLLAPSE OF THE INDUSTRY,+ HE SAID.
MR CHEONG POINTED OUT THAT, IF THAT SCENARIO WERE TO MATERIALISE, 20 PER CENT OF HONG KONG'S EXPORT EARNINGS WOULD BE SERIOUSLY JEOPARDISED AND 20 PER CENT OF THE LABOUR FORCE WOULD HAVE TO READJUST AND FIND OTHER JOBS.
HE SAID HONG KONG COULD NOT AFFORD SUCH HUGE LOSSES IN EXPORT EARNINGS.
+I WOULD STRONGLY URGE THE GOVERNMENT, THEREFORE, TO DEVISE CONTINGENCY PLANS TO PREVENT SUCH A DISASTER FROM HAPPENING.
/+THE CONTINGENCY