XN000022-1993-05-28 — Page 6

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FRIDAY, MAY 28, 1993

THE TERMS

REAL FOLLOWING

GROSS DOMESTIC PRODUCT (GDP) GREW BY AN ESTIMATED 5.1%

IN

IN THE FOURTH QUARTER OF 1992 OVER A YEAR EARLIER, A SIMILAR INCREASE IN THE THIRD QUARTER.

THE GDP GROWTH RATE IN THE FIRST QUARTER OF 1993 WAS PROBABLY IN THE REGION OF 5-5.5%.

IN THE FIRST QUARTER, THE LABOUR MARKET REMAINED GENERALLY STABLE, WHILE CONSUMER PRICE INFLATION WAS ON A MODERATING TREND.

THESE DEVELOPMENTS ARE DESCRIBED IN THE FIRST QUARTER ECONOMIC REPORT 1993 RELEASED TODAY (FRIDAY).

THE GOVERNMENT ECONOMIST, MR TANG KWONG-YIU, SAID FOLLOWING AN ONGOING PRACTICE, THE ECONOMIC FORECASTS FOR THE YEAR HAD BEEN REVIEWED AND UPDATED IN PARALLEL WITH THE PREPARATION OF THE ECONOMIC REPORT.

ADJUSTMENTS ARE MADE TO A FEW COMPONENTS, BUT THE FORECAST GROWTH RATE IN REAL TERMS OF THE GDP FOR 1993 IS MAINTAINED AT 5.5%.

THE FORECAST INFLATION RATE FOR 1993, IN TERMS OF THE CONSUMER PRICE INDEX (A) AS WELL AS THE GDP DEFLATOR, IS ALSO KEPT UNCHANGED, BOTH AT 9.5%.

IN

THE EXTERNAL SECTOR, TOTAL EXPORTS GREW RAPIDLY, BY ABOUT 19% IN REAL TERMS IN THE FIRST QUARTER OF 1993 OVER A YEAR EARLIER. WITHIN THIS TOTAL, RE-EXPORTS WERE ABOUT 27% HIGHER IN REAL TERMS.

RE-EXPORTS TO CHINA ROSE SHARPLY, SUPPORTED BY THE SUSTAINED DEVELOPMENT IN OUTWARD PROCESSING ACTIVITIES AS WELL AS A FAST INCREASING DEMAND FOR IMPORTS FOR CHINA'S OWN CONSUMPTION.

RE-EXPORTS TO MOST OF THE OTHER MAJOR MARKETS ALSO RECORDED FURTHER MARKED INCREASES.

THE

WITH SUCH A STRONG PERFORMANCE, THE SHARE OF RE-EXPORTS IN VALUE OF TOTAL EXPORTS CONTINUED TO RISE, FROM 74% IN THE FIRST QUARTER OF 1992 TO 78% IN THE FIRST QUARTER OF 1993.

IN CONTRAST, THE PERFORMANCE OF DOMESTIC EXPORTS REMAINED EXPORT SLACK, BRING AFFECTED BY THE CONTINUED STRUCTURAL SHIFT IN THE COMPOSITION TO RE-EXPORTS.

IN THE FIRST QUARTER, DOMESTIC EXPORTS SHOWED VIRTUALLY NO GROWTH IN REAL TERMS OVER A YEAR EARLIER.

ALTHOUGH DOMESTIC EXPORTS TO CHINA AND TO MANY MARKETS IN

REGION ASIA-PACIFIC

CONTINUED TO RISE SIGNIFICANTLY,

ΤΟ THOSE UNITED STATES, GERMANY, THE UNITED KINGDOM AND JAPAN FELL.

THE

THE

ABOUT OF

OF IMPORTS RECORDED A FURTHER SUBSTANTIAL GROWTH TOTAL 20%

MOST IN REAL TERMS IN THE FIRST QUARTER OVER A YEAR EARLIER. THIS GROWTH WAS ATTRIBUTABLE TO THE CONTINUED EXPANSION IN HONG KONG'S RE-EXPORT TRADE.

THE SUSTAINED INCREASE IN RETAINED IMPORTS, BY ABOUT 10% IN REAL TERMS IN THE FIRST QUARTER OVER A YEAR EARLIER, ALSO CONTRIBUTED.

/AMONG THE