XN000022-1990-03-16 — Page 6

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FRIDAY, MARCH 16, 1990

THERE ARE AT PRESENT ABOUT 600

MANUFACTURING ESTABLISHMENTS WITH OVERSEAS INVESTMENT, REPRESENTING ABOUT 1.2 PER CENT OF THE TOTAL NUMBER, YET THEY EMPLOY ABOUT 108,000 WORKERS (12.8 PER CENT OF THE TOTAL MANUFACTURING WORKFORCE) AND ACCOUNT FOR 23.4 PER CENT OF HONG KONG'S TOTAL DOMESTIC MANUFACTURED EXPORTS.

MR LEUNG ALSO EXPECTED HONG KONG WOULD SEE A NEW GENERATION

OF MODERN MANUFACTURERS. THEY WOULD OPERATE IN CLEAN, WELL DESIGNED AND WELL SERVICED FACTORIES AND THEIR PRODUCTS WOULD ACHIEVE INCREASING INTERNATIONAL REPUTATION FOR QUALITY.

"OUR 'SWEATSHOP' IMAGE, ALREADY

EXAGGERATED,

WILL HAVE GONE

*

FOREVER, MR LEUNG SAID.

HE SAID WORLD TRADE WAS EXPECTED TO EXPAND EXPONENTIALLY, PARTICULARLY TRADE IN THE ASIA PACIFIC REGION.

"ECONOMIC REALITIES ALSO NECESSITATE THE CONTINUAL EXPANSION OF CHINA'S TRADE WITH THE REST OF THE WORLD.

"HONG KONG IS EXPECTED TO PLAY A PIVOTAL ROLE ECONOMICALLY BOTH AS A REGIONAL CENTRE AND AS THE GATEWAY TO CHINA," HE SAID.

MR LEUNG ADDED THAT THE TERM "MANUFACTURING INDUSTRY" WAS EVOLVING TO ENCOMPASS MORE OF THE MANUFACTURING TECHNICAL SUPPORT ACTIVITIES INCLUDING PRODUCT DEVELOPMENT, QUALITY ASSURANCE, TESTING AND OTHER SKILL-INTENSIVE BACK-UP SERVICES.

ΤΟ DIVERSIFY MORB

"ACTUAL ASSEMBLY-TYPE PRODUCTION IS LIKELY INTO NEIGHBOURING REGIONS WITH LOWER COSTS, INCLUDING SOUTH CHINA AND SOUTHEAST ASIA.

"SO HONG KONG WILL CONTINUE TO DEVELOP INTO A REGIONAL CENTRE FOR, RATHER THAN A CENTRE OF, MANUFACTURING, HE SAID.

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MR LEUNG SAID HE WOULD EXPECT THAT THE MAIN TRADITIONAL INDUSTRIES WOULD CONTINUE TO THRIVE IN THE YEARS AHEAD, BUT WERE LIKELY TO ACCOUNT FOR A DECREASING PROPORTION OF THE TOTAL WORKFORCE.

"YET WHAT THEY MAY LOSE IN EMPLOYMENT SIZE, THEY ARE LIKELY ΤΟ GAIN IN VALUE-ADDED, AVERAGE FACTORY EMPLOYMENT WOULD CONTINUE TO FALL GRADUALLY AS AUTOMATION BECOMES EVEN MORE COMMON.

"ELECTRONICS WILL PROBABLY BE AN EVEN MORE IMPORTANT INDUSTRY SECTOR THAN IT IS NOW, OTHER NEW SECTORS, SUCH AS CHEMICAL PROCESSING AND BIOTECHNOLOGY, MAY WELL EMERGE," HE SAID.

ACKNOWLEDGING THAT HONG KONG WAS UNIQUELY VULNERABLE TO EVENTS OUTSIDE ITS CONTROL, MR LEUNG STRESSED THAT HONG KONG MUST NOT HOWEVER, ALLOW OVER-PESSIMISM TO BLIND ITSELF TO DYNAMIC

OPPORTUNITIES AHEAD.

/HE SAID