XN000022-1986-03-16 — Page 3

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SUNDAY, MARCH 16, 196

INITIALLY. IT WILL SEEK TO BUILD UP A DATA BASE TO KEEP ABREAST OF DEVELOPMENTS OF NEW PRODUCTS.

AT THE SAME TIME. THE COMPANY WILL CARRY OUT ASSESSMENTS OF DIFFERENT CATEGORIES OF LOCALLY MANUFACTURED GOODS IN TERMS OF THEIR POTENTIAL FOR DESIGN AND INNOVATION. PROPOSALS WILL THEN BE PREPARED AND PRESENTED TO MANUFACTURERS FOR CONSIDERATION.

AS A PARALLEL EXERCISE, HKDIC WILL PROVIDE SERVICES TO INDIVIDUAL MANUFACTURERS FOR SPECIFIC INNOVATION AND DEVELOPMENT PROJECTS.

THE COMPANY, WHICH WILL OPERATE AS A BUSINESS BY CHARGING MARKET RATES FOR ITS SERVICES, IS GOVERNED BY AN EIGHT-MEMBER BOARD OF DIRECTORS MADE UP OF REPRESENTATIVES FROM THE INDUSTRIAL, INSTITUTIONAL, TECHNICAL AND ACADEMIC SECTORS. ITS CHAIRMAN, MR CHRISTOPHER CHENG, IS A MEMBER OF THE INDUSTRY DEVELOPMENT BOARD AND A LEADING INDUSTRIALIST. THE DIRECTOR OF INDUSTRY, MR K.Y. YEUNG, IS THE SOLE GOVERNMENT REPRESENTATIVE ON THE BOARD.

ENCOURAGING HONG KONG INDUSTRY TO GIVE GREATER EMPHASIS TO PRODUCING ORIGINAL, WELL-DESIGNED PRODUCTS HAS LONG BEEN A GOVERNMENT POLICY. HOWEVER, SMALL AND MEDIUM-SIZED FACTORIES, WHICH MAKE UP THE BACKBONE OF HONG KONG INDUSTRY, GENERALLY LACK THE IN-HOUSE CAPABILITIES FOR DESIGN AND DEVELOPMENT. AS A RESULT MANY MANUFACTURERS TEND TO GIVE ONLY LOW PRIORITY TO THE CONCEPT OF PRODUCT DESIGN AND INNOVATION.

AT THE SAME TIME, WITH HONG KONG CAUGHT BETWEEN THE PINCER OF RISING PROTECTIONISM IN SOME OF ITS MAJOR EXPORT MARKETS AND INCREASINGLY FIERCE COMPETITION FROM NEIGHBOURING COUNTRIES WITH CHEAPER LABOUR, THE GOVERNMENT IS CONCERNED THAT INDUSTRY MUST STEP UP EFFORTS TO MOVE TOWARDS HIGHER QUALITY GOODS TO REMAIN COMPETITIVE.

IT WAS AGAINST THIS BACKGROUND THAT THE INDUSTRY DEVELOPMENT BOARD APPROVED IN MARCH LAST YEAR THE ESTABLISHMENT OF A COMPREHENSIVE PRODUCT DESIGN, INNOVATION AND DEVELOPMENT SERVICE TO ASSIST MANUFACTURERS, PARTICULARLY SMALL AND MEDIUM-SIZED FACTORIES.

IN A MOVE THAT UNDERSCORES GOVERNMENT'S CONTINUING COMMITMENT TO PROVIDING A SOLID INFRASTRUCTURE FOR HONG KONG INDUSTRY, IT HAS EARMARKED $9.2 MILLION TO THE HKDIC. THIS COMPRISES A SUBVENTION OF $8 MILLION TO COVER THE FIRST THREE YEARS OF THE COMPANY'S OPERATIONS AND AN INTEREST-FREE LOAN OF $1.2 MILLION TO BE TAKEN OUT IN THE FOURTH YEAR.

THE COMPANY IS EXPECTED TO BE FINANCIALLY INDEPENDENT IN ITS FIFTH YEAR OF OPERATION.

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