XN000022-1976-09-06 — Page 4

3

MONDAY, SEPTEMBER 6, 1976

*AT THE SAME TIME, THERE HAS BEEN A SIGNIFICANT IMPROVEMENT IN THE ORDERS-ON-HAND POSITION FOR LARGE MANUFACTURING ESTABLISHMENTS, WITH AVERAGE ORDERS-ON-HAND

IN THE SECOND QUARTER OF 1976 BEING 21 PER CENT HIGHER THAN THE CORRESPONDING QUARTER A YEAR AGO. IN THIS CONNECTION, THE REPORT POINTS OUT THAT ORDERS-ON-HAND POSITIONS ARE GIVEN ON THE BASIS OF EMPLOYMENT LEVELS THAT WERE PREVAILING IN THE REPORTING MONTHS AND SHOULD THEREFORE BE VIEWED IN THE CONTEXT OF THE SUBSTANTIAL INCREASE IN EMPLOYMENT THAT HAS ALSO BEEN TAKING PLACE.

THE REPORT ALSO SHOWS STEADY INCREASES IN EMPLOYMENT IN NON-MANUFACTURING SECTORS SUCH AS THE WHOLESALE/RETAIL AND THE IMPORT/EXPORT TRADES, BANKS, RESTAURANTS AND HOTELS.

AGAINST THE BACKGROUND OF A RAPIDLY IMPROVING LABOUR MARKET, DIFFERENT MEASURES OF WAGE RATES SHOWED REAL INCREASES OF 13 TO 15 PER CENT BETWEEN MARCH 1975 AND MARCH 1976, THE REPORT COMMENTS THAT THESE WERE PROBABLY THE HIGHEST ANNUAL INCREASES EVER RECORDED IN REAL WAGE RATES.

WITHIN THE MANUFACTURING SECTOR, THE REPORT ADDS, THE PLASTICS INDUSTRY, THE TEXTILES AND GARMENTS INDUSTRY, THE ELECTRONICS INDUSTRY, AND THE WRIST WATCH BANDS INDUSTRY RECORDED HIGH INCREASES.

IN RESPECT OF CONSUMER PRICE MOVEMENTS, THE REPORT SAYS THAT THE VERY MODERATE INCREASES IN THE CONSUMER PRICE INDEXES (2 TO 3 PER CENT) IN THE FIRST HALF OF 1976 OVER THE FIRST HALF OF 1975 WAS MAINLY ATTRIBUTABLE TO VERY STABLE PRICES OF FOODSTUFFS, WHICH ARE MOSTLY IMPORTED.

PRICES OF IMPORTED RAW MATERIALS AND SEMI-MANUFACTURES, AS MEASURED BY THE IMPORT UNIT VALUE INDEX, ALSO REMAINED STABLE IN THE FIRST QUARTER OF 1976 AT ROUGHLY THE SAME AVERAGE LEVEL AS IN 1975. HOWEVER, AS DEMAND IN THE LARGE INDUSTRIAL ECONOMIES PICKS UP FURTHER, PRICES OF RAW MATERIALS AND SEMI-MANUFACTURES IN GENERAL MAY START TO INCREASE, AS IS EVIDENCED IN THE IMPORT UNIT VALUE INDEXES IN THE SECOND QUARTER OF 1976.

COMMENTING ON THE REPORT, A GOVERNMENT SPOKESMAN SAID THAT THE FLEXIBILITY AND ADAPTABILITY OF THE HONG KONG ECONOMY IN ADJUSTING TO EXTERNAL CHANGES HAS MADE POSSIBLE A RAPID RECOVERY FROM THE RECESSION. IT IS ENCOURAGING TO SEE THAT IN A SHORT PERIOD OF ROUGHLY ONE YEAR. THE ECONOMY APPEARS TO HAVE FULLY RECOVERED FROM THE WORST RECESSION EXPERIENCED SINCE THE END OF THE SECOND WORLD WAR,+ HE SAID.

THE HALF-YEARLY ECONOMIC REPORT WILL BE AVAILABLE SHORTLY FROM THE GOVERNMENT PUBLICATIONS CENTRE AT A PRICE OF $6 PER COPY.

O

14