XN000022-1986-05-26 — Page 3

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MONDAY, MAY 26, 1986

DESCRIBING THE ESSENTIALS OF HONG KONG'S ECONOMIC SYSTEM, SIR EDWARD SAID THE TERRITORY HAD FEW NATURAL RESOURCES, BUT ÍT HAD AN EXCELLENT HARBOUR A GOOD LOCATION ON THE SOUTH CHINA COAST AND IN RELATION TO THE ASIAN REGION'S TRADE ROUTES: EXCELLENT MAN-MADE COMMUNICATIONS; AN INDUSTRIOUS AND HARD-WORK ING POPULATION; AND A MATURE INTERNATIONAL FINANCIAL CENTRE.

+WE PRACTISE FREE TRADE AND OPEN OUR MARKETS TO ALL. THERE ARE NO TARIFF OR NON-TAR IFF BARRIERS TO IMPORTS INTO HONG KONG. NOR ARE THERE ANY BARRIERS OF INSTITUTIONAL PREJUDICE. WE BUY THE BEST PRODUCT AVAILABLE AT THE BEST AVAILABLE PRICE WHEREVER WE CAN FIND IT, HE SAID,

HE ADDED THAT COMPETITION IN HONG KONG WAS FREE AND FAIR AND AN OPEN ENVIRONMENT WAS MAINTAINED IN THE SERVICE SECTOR.

SIR EDWARD SAID THAT FOLLOWING THE SHARP APPRECIATION OF THE YEN IN RECENT MONTHS AND THE CONCERN EXPRESSED BY SOME OF JAPAN'S TRADING PARTNERS OVER ITS HUGE TRADE SURPLUSES, OVERSEAS INVESTMENT WOULD BECOME OF INCREASING INTEREST TO JAPANESE COMPANIES.

JAPANESE MANUFACTURERS WERE NO DOUBT EXPLORING POSSIBILITIES FOR MOVING SOME OF THE IR MANUFACTURING ACTIVITIES OFF-SHORE IN ORDER TO REMAIN COMPETITIVE, HE SAID.

IN THIS CONNECTION, SIR EDWARD SAID, HONG KONG OFFERED AN ECONOMIC SYSTEM WHICH SHOULD ATTRACT INVESTMENT ON A CONTINUING BASIS AND CONDUCIVE TO COMMERCIAL AND INDUSTRIAL DEVELOPMENT.

THE 18-1/2 PER CENT PROF ITS TAX WAS EXTREMELY LOW COMPARED WITH INDUSTRIALISED ECONOMIES IN THE WORLD WHILE THE PERSONAL TAX WAS AT A MAXIMUM OF 17 PER CENT.

HE LISTED OTHER FEATURES:

* NO RESTRICTION ON IMPORTS OF MATERIAL, EQUIPMENT

AND PRODUCTS;

* PROFITS AND CAPITAL CAN BE FREELY CONVERTED

AND REMITTED;

* THE BANKING AND FINANCIAL SYSTEM CAN BE RELIED

UPON TO BACK COMMERCIALLY SOUND PROJECTS;

* HONG KONG PRODUCTS ENJOY MOST FAVOURED NATION TREATMENT IN WORLD MARKETS AND HAVE EARNED A REPUTATION FOR QUALITY AND RELIABILITY;

* EXCELLENT COMMUNICATION, TRANSPORT AND OTHER

INFRASTRUCTURAL FACILITIES;

A GOVERNMENT