XN000022-1996-01-03 — Page 3

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On economic growth, Mr Tsang said Hong Kong's five per cent growth in real terms in 1995, although slower than in the preceding years( at 6.3 per cent in 1992, 6.4 per cent in 1993 and 5.4 per cent in 1994), was no recession by any standards.

He said external trade continued to grow strongly with total exports increased by about 13 per cent in real terms in the first 10 months last year.

"With a bit of patience, robust growth in our economy will return," he said.

On employment, Mr Tsang said during the rapid structural transformation in our economy, there were bound to be sectors expanding more rapidly than others.

The Government accepted a duty to help the workers who had been displaced and facing difficulties in finding alternative suitable employment, he said.

"We are doing so through the Labour Department's Job Matching Programme and the Employees Retraining Board.

"Retraining and job matching are the keys to helping the labour market work more efficiently and more humanely. They are among the highest priorities of the Government today," he said.

As for inflation, Mr Tsang said although inflation had moderated from the peak of 13.9 per cent in 1991 to the present 8.2 per cent, the Government would remain vigilant.

He said the recent easing in labour market conditions had dampened wage increases.

"Initially, workers would feel generally worse off. However, the moderating wage pressures are helpful in containing inflation and the cost of doing business," he said.

"So are the lower rentals in line with the consolidation of the property market. The rebound of the US dollar has also alleviated somewhat imported inflation,

"All these should be beneficial to our external competitiveness, and should help enhance our trade and development potential in the longer term," he said.

Mr Tsang said despite this positive note, the Government would hold down spending to reduce competition from the public sector for scarce resources in Hong Kong, and would continue to tackle the bottlenecks through an improved supply of skilled labour, land and a better transport and communications infrastructure.

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