XN000022-1974-03-31 — Page 7

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Sunday, March 31, 1974

PRICE INCREASE FOR SOFT DRINKS JUSTIFIED

The Director of Commerce and Industry, Mr. David Jordan, has

agreed that heavy cost increases justify a rise in the price of soft drinks.

In February 1973 the Beverage Manufacturers Association of Hong

Kong demonstrated to the Government that unless the duty on table waters

was abolished a price increase would be inevitable.

They undertook, however, that if the duty was abolished they would

keep their prices unchanged at least until April 1, 1974. They also said that

even after April 7, 1974 they would not increase thier prices for at least another

year unless they encountered exceptional increases in costs.

The cost inflation of 1973 has however seriously affected the beverage

manufacturers. The price of sugar, for instance a major ingredient of soft

drinks - increased 90 per cent between February 1973 and March 1974. Wages

and other costs have also increased substantially.

After a detailed examination of these cost increases it was clear

to the Director that the scale of increases had been such that a price

increase was justified.

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