XN000022-1985-10-02 — Page 9

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WEDNESDAY, OCTOBER 2, 1985

MR BLYE POINTED OUT THAT HONG KONG'S NOTE ISSUE MECHANISM WORKED WELL AND THAT CONCERN ABOUT APPARENT LACK OF CONSTRAINT ON HOW MUCH CASH THE NOTE-ISSUING BANKS CAN ISSUE WAS NOT WELL-FOUNDED. IT HAS BEEN SUGGESTED THAT THIS LACK OF CONSTRAINT MAY HAVE BEEN PARTLY RESPONSIBLE FOR THE RAPID EXPANSION OF THE MONEY SUPPLY AND CREDIT. PARTICULARLY IN THE EARLY EIGHTIES, WITH CONSEQUENT RAPID INFLATION AND DEPRECIATION OF THE HK DOLLAR.

+FIRST, + MR BLYE SAID, THERE IS A CONSTRAINT ON NOTE ISSUE BECAUSE CERTIFICATES OF INDEBTEDNESS ARE NON-INTEREST BEARING. IT IS, THEREFORE, TO THE ADVANTAGE OF NOTE-ISSUING BANKS TO MINIMIZE THE VOLUME OF NOTES IN CIRCULATION.

+SECOND, AND MORE IMPORTANT, HE ADDED, I KNOW OF NO MODERN ECONOMY, NOT EVEN AMONG THOSE MOST ARDENTLY COMMITTED TO MONETARY TARGETS, WHERE THE AUTHORITIES SEEK TO CONTROL THE AMOUNT OF CASH IN CIRCULATION.+

+CASH IS SIMPLY A SMALL COMPONENT, THE SMALL CHANGE,

ÚSE OF THE MONEY SUPPLY, PARTICULARLY NOW WITH THE GREATER OF CHEQUES, CREDIT CARDS AND ELECTRONIC BANKING, HE SAID.

SHIPBUILDING, SHIP REPAIR INDUSTRY GROWTH EXPECTED

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THE DEMAND FOR SKILLED MANPOWER IN THE SHIPBUILDING AND SHIP REPAIR INDUSTRY WILL GREATLY INCREASE IF DEVELOPMENT IN THE SOUTH CHINA SEA OIL INDUSTRY RESULTED IN BUSINESS FOR LOCAL SHIPYARDS, ACCORDING TO THE FINDINGS OF A 1984 MANPOWER SURVEY.

THE REPORT, BY THE SHIPBUILDING AND SHIP REPAIR INDUSTRY TRAINING BOARD OF THE VOCATIONAL TRAINING COUNCIL, REVEALED THAT THE LOCAL SHIPPING INDUSTRY WAS HIT HARD BY THE WORLDWIDE RECESSION IN THE PAST FEW YEARS, AND THE LABOUR FORCE OF THE INDUSTRY HAD DROPPED BY 27.2 PER CENT FROM 10 739 IN 1982 TO 7 815 IN 1984.

HOWEVER, THE NUMBER OF TECHNOLOGISTS GREW AT 5 PER CENT PER YEAR, AND THE BOARD BELIEVED THAT IT WOULD CONTINUE TO GROW SLOWLY AS THE INDUSTRY IN GENERAL MOVED INTO MORE TECHNOLOGY INTENSIVE ACTIVITIES.

EVEN THOUGH THE PRESENT LOW DEMAND FOR THE INDUSTRY'S SERVICES WOULD CONTINUE FOR A FEW YEARS, THE REPORT NOTED THAT EMPLOYERS FORECAST NO FURTHER GREAT REDUCTION IN NUMBER OF POSTS.

/+HOWEVER, MANPOWER