XN000022-1996-10-10 — Page 2

- 1 -

Transcript of Governor's question-and-answer session

Following is the transcript of the question-and-answer session given by the Governor, the Rt Hon Christopher Patten, after the luncheon held by the Hong Kong General Chamber of Commerce this (Thursday) afternoon:

Question: (inaudible) ... could you possibly give some indication that the government would review this scheme sometime before the labour market becomes far too tight?

Governor: Yes, we will review the scheme with you and the unions and the LAB when we get to the 2,000 figure as we have said before. Can I just say a couple of words about unemployment and a word or two about importation of labour consequences of candour in what I say.

and risk the

Hong Kong goes on year after year increasing the number of jobs on offer by about 2.5 per cent to three per cent every year. The problems we have had on the unemployment front in the last year or two have not been a consequence of macro- economic policy, have not been a consequence of a failure to go on increasing the number of jobs available, the problem has been that the number of people looking for jobs has increased. And last year it increased very substantially, largely because of the number of legal immigrants from China arriving of working age, and because of the number of emigrants from Hong Kong returning from Canada, Australia and elsewhere to resume a career and business in Hong Kong after establishing right of abode elsewhere.

This year the fall in unemployment from last year's peak of 3.6 per cent to 2.8 per cent isn't, though I'd like to pretend otherwise, the result of some brilliant stroke of macro-economic policy. The reason for the fall is that once again the number of jobs we are creating and the number of people looking for work have fallen back more or less into line, so the unemployment figure itself has fallen.

-

The second thing that I'd like to say is that against that background we do have to try to make our labour market work more efficiently, which is why we have been trying to develop our local employment services with some success, they have placed about 12,000 people in jobs this year our job-matching programme, and it is why at the moment we are reviewing our training and retraining programmes so that they serve you and business far more successfully than they perhaps have in the past, despite the efforts of all those involved in the training and retraining sectors.