XN000022-1987-05-26 — Page 4

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TUESDAY, MAY 26, 1987

+THE SENATE BILL, WHICH IS STILL UNDER DISCUSSION, WHILE MORE MODERATE STILL SEEKS TO LIMIT THE PRESIDENT'S DISCRETION IN CERTA IN AREAS, WHILE THE ADMINISTRATION'S BILL PUTS EMPHASIS ON COMPETITIVENESS INSTEAD OF ON MORE RESTRICTIVE TRADE MEASURES, +

+PROTECTIONIST SENTIMENT IN THE U.S. CONGRESS IS FOUNDED ON SUSTAINED AND GROWING TRADE DEFICITS COUPLED WITH AN ENORMOUS AND

INTRACTABLE BUDGET DEFICIT.

+THE ADMINISTRATION HAS BEEN VERY VOCAL IN ITS OPPOSITION NOT ONLY TO THE TEXTILES BILL, BUT ALSO TO A VARIETY OF MEASURES IN THE GENERIC BILLS.

+BUT THAT BEING SAID THERE ARE STILL DANGERS FOR HONG KONG,+ HE WARNED.

+THERE IS THE DANGER THAT THE TEXTILES BILL WILL PASS BOTH HOUSES, THAT MEASURES WILL BE INCORPORATED IN THE FINAL GENER IC TRADE BILL AND THAT MEASURES INCORPORATED IN EITHER BILL MAY UNDERMINE THE MULTILATERAL PROCESS IN THE GATT. AND PREVENT THE ACHIEVEMENT OF GREATER LIBERALISATION IN THE SERVICES, INTELLECTUAL PROPERTY RIGHTS, AND AGRICULTURE.+

STRONG EXPORT-LED ECONOMIC GROWTH CONTINUES IN FIRST QUARTER

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THE GROWTH OF THE HONG KONG ECONOMY IN THE FIRST QUARTER OF 1987 WAS MAINLY EXPORT-LED, CONTINUING THE TREND ESTABLISHED IN THE LATTER PART OF 1986, ACCORDING TO THE FIRST QUARTER ECONOMIC REPORT 1987 PUBLISHED BY THE GOVERNMENT TODAY (TUESDAY).

WHILE DOMESTIC EXPORTS STILL PROVIDED A MAJOR IMPETUS TO OVERALL GROWTH, RE-EXPORTS FEATURED PROMINENTLY IN THE RECENT GROWTH PATTERN OF EXTERNAL TRADE, THE REPORT ALSO SAID.

DOMESTIC EXPORTS CONTINUED TO GROW RAPIDLY IN THE FIRST QUARTER OF 1987. COMPARED WITH THE FIRST QUARTER OF 1986, DOMESTIC EXPORTS GREW BY ABOUT 28 PER CENT IN REAL TERMS IN THE FIRST QUARTER OF 1987. THIS WAS HIGHER THAN THE YEAR-ON-YEAR GROWTH RATE OF 23 PER CENT IN THE SECOND HALF OF 1986.

WHILE IMPROVED DEMAND FOR IMPORTS IN MANY OF HONG KONG'S MAJOR OVERSEAS MARKETS HAS CONTRIBUTED TO THIS PERFORMANCE, THE DEPRECIATION OF THE HONG KONG DOLLAR (IN LINE WITH THE DEPRECIATION OF THE US DOLLAR UNDER THE LINKED EXCHANGE RATE SYSTEM) AGAINST MAJOR CURRENCIES AND THE CAUTIOUS ATTITUDE OF LOCAL MANUFACTURERS IN RAISING PRICES HAVE ALSO HELPED ENHANCE THE EXTERNAL COMPETITIVENESS OF HONG KONG'S PRODUCTS.

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