XN000022-1992-03-04 — Page 4

WEDNESDAY, MARCH 4, 1992

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WHILE HE WAS CONSCIOUS OF THE IMPORTANCE OF CONTINUITY IN ECONOMIC POLICY, HE SAID HE WAS ALSO AWARE THAT HONG KONG WAS IN THE PROCESS OF TRANSFORMATION,

BE AND THAT THIS FACT MUST

ACCOUNT IN FRAMING THE GOVERNMENT'S POLICIES.

TAKEN INTO

HE ALSO SAID THE ECONOMY HAD UNDERGONE A PROFOUND STRUCTURAL CHANGE IN RECENT YEARS AS A LARGE PART OF HONG KONG'S MANUFACTURING BASE HAD BEEN TRANSFERRED TO THE LOWER COST ENVIRONMENT OF GUANGDONG.

HONG KONG'S TRADING PATTERNS HAD ALSO CHANGED.

HONG KONG'S SUCCESS IN THE 1950S AND 19608 WAS BASED ON TRADE WITH NORTH AMERICA AND EUROPE WHILE THESE MARKETS WERE CERTAINLY STILL VERY IMPORTANT, IT WAS AT PRESENT TRADE WITH ITS NEIGHBOURS IN ASIA WHICH GAVE THE ECONOMY. ITS DYNAMISM, HE SAID.

"BUT THIS PROCESS OF TRANSFORMATION GOES BEYOND THE STRUCTURE OF THE ECONOMY AND THE TRADING PATTERNS. THE PRIORITIES AND ASPIRATIONS OF THE COMMUNITY ARE ALSO CHANGING.

"IT

IS THE GOVERNMENT'S RESPONSIBILITY TO TAKE ACCOUNT OF THE COMMUNITY'S DESIRE FOR BETTER PUBLIC SERVICES, HE SAID.

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THE FINANCIAL SECRETARY SAID THE GOVERNMENT HAD TO TAKE ACCOUNT OF THE FACT THAT THE PROPORTION OF ELDERLY PEOPLE IN THE COMMUNITY WAS INCREASING.

"WE HAVE TO HELP THE WORKFORCE ADJUST TO THE CHANGING CHARACTER OF THE ECONOMY.

PHYSICAL AND WE

"WE HAVE то CONTINUE INVESTING IN OUR SOCIAL AND INFRASTRUCTURE то SECURE THE TERRITORY'S FUTURE PROSPERITY, HAVE TO FACE UP TO THE INFLATIONARY PRESSURES WHICH ARISE FROM STRUCTURAL CHANGE AND OUR SHORTAGE OF RESOURCES, HE SAID.

"

MR MACLEOD SAID HE HAD NO DOUBT THAT THE PEOPLE OF HONG UNDERSTOOD THAT IF THEY WERE TO CONTINUE THEIR RECORD OF SUCCESS, HEALTH OF THE ECONOMY MUST BE ENSURED.

KONG THE

"AN

OPEN ECONOMY, DEPENDENT ON VOLATILE WORLD MARKETS AND ITS CAPACITY TO RESPOND FLEXIBLY AND PROMPTLY TO CHANGING CIRCUMSTANCES, MUST AVOID MORTGAGING ITS FUTURE OR DEVELOPING A MONOLITHIC PUBLIC SECTOR," HE STRESSED.

THIS MEANT ENSURING THAT THE GROWTH OF PUBLIC EXPENDITURE REMAINED IN STEP WITH THE RATE OF ECONOMIC GROWTH.

"WE

CANNOT ACHIEVE ALL OF OUR OBJECTIVES AT ONCE, BUT WE ARE FORTUNATE THAT THE SUCCESS OF OUR ECONOMY HAS MEANT THAT THIS YEAR WE ARE ABLE TO DEVOTE ADDITIONAL RESOURCES TO MEETING OUR OBJECTIVES, HE CONTINUED.

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NEVERTHELESS, HE SAID, THE GOVERNMENT HAD TO SET PRIORITIES AND MAKE CHOICES. SOME OF THESE CHOICES WOULD BE DIFFICULT.

/"IN FRAMING