XN000022-1975-02-26 — Page 29

WEDNESDAY, FEBRUARY 26, 1975

VIEWPOINT TALK BY FINANCIAL SECRETARY

I

THE FOLLOWING IS THE TEXT OF TALK. BY THE FINANCIAL SECRETARY BROADCAST TONIGHT #

+GOOD EVENING D

+THIS AFTERNOON PRESENTED THE BUDGET FOR THE 1975-76 TO THE LEGISLATIVE COUNCIL. MY SPEECH WILL BE AVAILABLE IN BOTH ENGLISH AND CHINESE FROM THE INFORMATION SERVICES DEPARTMENT. I HOPE THOSE OF YOU WHO HAVE THE TIME WILL OBTAIN A COPY AND READ IT AT YOUR LEISURE BECAUSE IT IS, ESSENTIALLY, A REPORT ON THE MANAGEMENT OF YOUR AFFAIRS OVER THE PAST YEAR AND IT SETS OUT THE GOVERNMENT'S PROPOSALS ON HOW THEY SHOULD BE MANAGED DURING THE COMING YEAR AND, INDEED, THEREAFTER.

+AS YOU ARE ALL WELL AWARE OUR ECONOMY HAS STOPPED GROWING FOR THE TIME BEING NOT THROUGH ANY FAULT OF OURS BUT BECAUSE THE DEMAND FOR OUR EXPORTS OVERSEAS HAS EASED OFF. THIS HAS BEEN LARGELY DUE TO THE ENORMOUS INCREASE IN OIL PRICES WHICH HAS SHIFTED A SIZEABLE CHUNK OF WORLD SPENDING POWER INTO THE HANDS OF OIL PRODUCING COUNTRIES. THESE COUNTRIES TEND TO HOLD ON TO THIS SPENDING POWER, IN THE FORM OF CASH DEPOSITS. SO UNTIL A RECYCLING OF THIS SPENDING POWER HAS BEEN ORGANIZED, WORLD DEHAND AND WORLD TRADE WILL NOT GROW AT THE RATE WE HAVE BECOME. USED TO IN RECENT YEARS. THIS AFFECTS OUR EXPORT EARNINGS, THE LEVEL OF OUR WAGES AND PROFITS INTERNAL INCOMES AND, OF COURSE, THE YIELD FROM THOSE TAXES AND LEVIES ON MIICH THE GOVERNMENT DEPENDS TO FINANCE THE PUBLIC SERVICES AND CAPITAL WORKS PROGRAMMES.

+SO THE ECONOMY IS PAUSING IN BETWEEN ONE PERIOD OF ECONOMIC GROWTH WHICH FADED AWAY EARLY 'LAST YEAR AND THE NEXT. JUST WHEN THE GROWTH OF WORLD TRADE WILL BEGIN TO PICK UP REALLY IS DIFFICULT TO PREDICT, BUT IN THIS AFTERNOON'S BUDGET SPEECH I SAID I THOUGHT THAT, AFTER A STANDSTILL FOR MOST OF THIS YEAR, A RECOVERY WOULD GET UNDER WAY IN TIME TO IMPROVE OUR PROSPECTS IN 1976.

+HONG KONG MUST BE READY TO RESPOND QUICKLY AND PROFITABLY TO A RENEWAL OF GROWTH IN WORLD TRADE WHEN IT DOES OCCUR. IF OUR PAST IS ANYTHING TO GO BY, WE SHOULD. AND I PREDICT THAT AFTER RECOVERING IN 1976, OUR ECONOMY REALLY WILL GET INTO FULL GEAR AGAIN IN 1977 AND 1978. MEANWHILE, OUR FINANCIAL AFFAIRS HAVE TO BE MANAGED IN SUCH A WAY AS NOT TO IMPAIR THE ECONOMY'S ABILITY TO RESPOND. AT THE SAME TIME, SOMEHOW,

AT THE SAME TIME, SOMEHOW, ESSENTIAL PUBLIC SERVICES MUST BE MAINTAINED AND, SOMEHOW, OUR SOCIAL DEVELOPMENT PROGRAMMES MUST PROCEED, AND ON A BROAD FRONT, IF NOT AT THE PACE WE WOULD PREFER.

/<AGAINST THIS