XN000022-1985-08-18 — Page 7

I

SUNDAY, AUGUST 18, 1985

FIRMS IN THE TEXTILES INDUSTRY REPORTED A DETERIORATION. THIS WAS CONTRARY TO THEIR EARLIER EXPECTATIONS FOR AN

IMPROVEMENT IN BUSINESS AS INDICATED IN THE LAST ROUND OF SURVEY.

AS REGARDS THE BUSINESS OUTLOOK FOR THE THIRD QUARTER OF 1985, FIRMS IN THE FOOD, BEVERAGE AND TOBACCO, PLASTICS, ELECTRONICS AND WATCHES AND CLOCKS INDUSTRIES ARE GENERALLY MORE OPTIMISTIC AND EXPECT AN IMPROVEMENT IN BUSINESS OUTLOOK.

WHILE PARTICIPATING FIRMS IN THE WEARING APPAREL INDUSTRY EXPECT A MARGINAL IMPROVEMENT IN BUSINESS, FIRMS IN THE TEXTILES, FABRICATED METAL PRODUCTS AND ELECTRICAL MACHINERY, APPLIANCES AND SUPPLIES INDUSTRIES EXPECT THE BUSINESS SITUATION IN

THE THIRD QUARTER TO REMAIN LARGELY SIMILAR TO THAT EXPERIENCED IN THE SECOND QUARTER.

A CONTINUED UPTURN IN BUSINESS WAS EXPERIENCED BY CONSTRUCTION FIRMS IN THE SECOND QUARTER AND THEY LOOK FORWARD TO FURTHER ADVANCEMENT IN BUSINESS IN THE THIRD QUARTER.

FIRMS IN BOTH THE WHOLESALE, RETAIL AND IMPORT-EXPORT TRADES AND RESTAURANTS SECTOR EXPERIENCED A FALL IN BUSINESS IN THE SECOND QUARTER, BUT THEY EXPECT THEIR BUSINESS PERFORMANCE TO IMPROVE IN THE THIRD QUARTER.

AN IMPROVEMENT IN BUSINESS IN THE SECOND QUARTER WAS REPORTED BY FIRMS IN THE HOTELS BUSINESS BUT THEY EXPECT A DECL IM. IN BUSINESS IN THE THIRD QUARTER, DUE MAINLY TO SEASONAL FACTORS.

WITH REGARD TO THE OTHER SERVICES SECTOR, IMPROVEMENTS IN BUSINESS WERE GENERALLY EXPERIENCED BY FIRMS IN DIFFERENT CATEGORIES OF SERVICES, INCLUDING THE TRANSPORT, STORAGE AND COMMUNICATION, BANKS AND REAL ESTATE DEVELOPMENT AND RELATED SERVICES BUSINESSES. THESE FIRMS HOLD AN OPTIMISTIC VIEW OF THE BUSINESS OUTLOOK FOR THE THIRD QUARTER AND EXPECT FURTHER IMPROVEMENTS IN BUSINESS.

FOR BOTH THE MANUFACTURING AND CONSTRUCTION SECTORS INSUFFICIENT BUSINESS ORDERS OR CONTRACTS, PRICE COMPETITION FE FIRMS IN HONG KONG AND FROM OVERSEAS REMAINED THE MAJOR PROBLE FOR THE SECOND AND THIRD QUARTERS.

WITHIN THE WHOLESALE, RETAIL AND IMPORT-EXPORT TRADES, RESTAURANTS AND HOTELS SECTOR,FIRMS ACROSS ALL INDUSTRIES CITED PRICE COMPETITION AS A PROMINENT PROBLEM IN THE SECOND QUARTER, WITH LITTLE PROSPECT OF EASING IN THE THIRD QUARTER.

AS FOR THE RESTAURANTS BUSINESS, THERE WAS AN INCREASE IN THE PROPORTION OF FIRMS CONSIDERING INSUFFICIENT BUSINESS AS A SIGNIFICANT PROBLEM IN THE SECOND QUARTER AND THIS PROBLEY IS EXPECTED TO REMAIN IN THE THIRD QUARTER. ON THE OTHER HAND THE PROMINENCE OF THE PROBLEM OF HIGH STAFF TURNOVER EASED IN THE SECOND QUARTER.

MHL CENSUS