TUESDAY, JANUARY 5, 1993
NAFTA AND EUROPEAN SINGLE MARKET GENERATE OPPORTUNITIES
* * * *
THE IMMINENT ESTABLISHMENT OF THE NORTH AMERICAN FREE TRADE AGREEMENT (NAPTA) AND IMPLEMENTATION OF THE SINGLE EUROPEAN MARKET ARE SEEN AS "OPPORTUNITIES, AND NOT AS OBSTACLES TO FREE TRADE" BY THE DEPUTY DIRECTOR-GENERAL OF TRADE, MR ALAN DAL.
SPEAKING AT A SEMINAR ORGANISED BY THE CHINESE GENERAL CHAMBER OF COMMERCE TODAY (TUESDAY), MR LAT SAID HE WAS CONFIDENT THAT BUSINESSMEN IN HONG KONG, WHO WERE KNOWN FOR THEIR FLEXIBILITY AND INGENUITY, WOULD BE ABLE TO OPTIMISE ON THESE CHANGES.
HE SAID CONCERNS THAT THESE REGIONAL ARRANGEMENTS MIGHT LEAD TO TRADE AND INVESTMENT DIVERSION WERE LEGITIMATE.
"NO ONE COULD CLAIM THAT REGIONAL TRADE ARRANGEMENTS WOULD NOT IN ANY WAY ALTER EXISTING TRADE PATTERNS. HOWEVER, THE INCOME-GENERATING EFFECT OF SUCH ARRANGEMENT CANNOT BE IGNORED.
* INCREASED INVESTMENT AND TRADE OPPORTUNITIES ARISING AS A RESULT OF RATIONALISED PRODUCTION AND ENHANCED MARKETS WILL MORE THAN OFFSET ANY LOSSES ATTRIBUTABLE TO TRADE AND INVESTMENT DIVERSIONS, MR LAI SAID.
"
AS IN THE CASE OF NAFTA, PRELIMINARY STUDIES CONDUCTED BY THE TRADE DEVELOPMENT COUNCIL. SUGGESTED THAT THERE WOULD BE AMPLE OPPORTUNITIES FOR HONG KONG FIRMS BOTH IN TERMS OF A MORE PROSPEROUS MARKET FOR HONG KONG CONSUMER GOODS AND THE PROSPECTS OF MANUFACTURING IN LOW-COST MEXICO TO ACCESS NOT ONLY THE GROWING HEXICAN MARKET, BUT ALSO THE U.S. AND CANADA.
ACCORDING TO TRADE DEPARTMENT'S
PRELIMINARY ANALYSIS, HONG KONG TN SPECIFIC
THERE WAS POTENTIAL FOR TRADE DIVERSION FROM PRODUCTS AS A RESULT OF TARIFF PHASE-OUTS IN THE LONGER TERM, BUT IT SHOULD NOT BE SIGNIFICANT IN THE SHORTER TERM.
FOR EXAMPLE, IN RESPECT OF TOYS AND CONSUMER ELECTRONICS, SIGNIFICANT AND IMMEDIATE TRADE DIVERSION WILL. UNLIKELY MOST OF THESE PRODUCTS NOW ENTER THE U.S. AT LAT SAID.
OCCUR, SINCE LOW TARIFF RATES, MR
NAPTA PROVIDED FOR TEXTILE AND APPAREL MANUFACTURED TN MEXICO TO BE ENTITLED TO PREFERENTIAL TARIFF TREATMENT AND ITS RULE OF ORIGIN REQUIRED MOST TEXTILE AND APPAREL GOODS BE PRODUCED FROM YARN MADE IN A NAFTA COUNTRY.
"THESE ARRANGEMENT AND REQUIREMENTS APPEAR TO HAVE A RESTRAINING EFFECT ON IMPORT, BUT GIVEN THE EXISTING PRODUCTION Will. CAPABILITY IN NORTH AMERICA, OUR INITIAL ASSESSMENT IS THAT THIS UNLIKELY RESULT IN SIGNIFICANT TRADE DIVERSION IN THE TEXTILE AND APPAREL SECTOR.
"DEMAND FOR TEXTILE AND APPAREL IMPORTS FROM SHOULD CONTINUE," HE SAID.
HONG KONG FIRMS
/AS REGARDS
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