TNAG-0132-FCO40-168-Tariff-preferences-for-developing-countries-1969 — Page 138

TELEPHONE: LONDON WALL 1180

THE HONG KONG ASSOCIATION

bu. Stewant.

BROAD STREET HOUSE

54.OLD BROAD STREET

LONDON, E C.2.

BULLETIN NO. 40

1st January 1969

It will be seen from the trade figures given later in this Bulletin 1968 has been a remarkable year for Hong Kong's trade and all the indications are that, provided world trade maintains its present momentum, Hong Kong will enjoy boom conditions in the early part of 1969.

Exports have been diversified and for the first time textiles

account for less than 50% of the total.

The strength of the economy is perhaps best illustrated by the speed and efficiency with which the banking system reacted to the British Government's 50% import deposit scheme.

IMPORT DEPOSITS Major banks in Hong Kong have advised their exporter customers there that they are prepared to pay the 50% deposit on imports payable by their customers in Britain.

The interest rate will be % p.a. and there will be a commission charge of 1%

This arrangement is possible since the Banks can be named as the parties to whom deposits are to be repaid. It therefore involves no more than a loan at interest and does not increase the credit allowed to the exporter or to the importer. As such, it is greatly preferable to the earlier proposals of extending the date of payment against documentary credits.

The interest charge and commission, amounting to 5% of the value of the deposit, is payable to the Bank in London by the Importer when the deposit is paid.

CONTAINER PORT There has been some criticism in the Press of the failure of Hong Kong to come to a decision on the subject of building facilities for the handling of containers. It is not an easy decision to make. Even a small container port is a very expensive proposition, and unless it is fully utilised, the primary objective of the system, the saving of money, would not be realised. The handling of cargo in Hong Kong is already quick and cheap and it is questionable if the use of containers would effect any saving there. There is, of course, the economy at the other end of the journey, and the greater safety of cargo factor to be considered.

Containers really come into their own if there is a hinterland to be served for the collection and distribution of goods. If for instance a container traffic for China through Hong Kong could be envisaged, there would be little doubt as to what Hong Kong's decision would be.

We understand that the principal shipping lines serving Hong Kong have not yet decided whether they will be putting container vessels on the run, and until they do, the authorities in Hong Kong consider it wise to suspend their own judgment.

THE COMMON MARKET The French Foreign Minister reaffirmed the opposition of France to the entry of Britain to the Common Market during a Press Conference on December 11th.