C. a 1. 371
2700493
3,000-7/67-B55633
27/6/1,
From: Counsellor for Hong Kong Commercial Affairs, Washington
To: Director of Commerce and Industry
Memorandum No.
BRITISH EMBASSY,
WASHINGTON, D.C.
(a) The ratio of profits to sales over the whole industry increased by 40% between 1961 and 66 (52) in the case of apparel), compared with an
(Even so, textile profits as a increase of only 21% for all menufactures. whole are still below the all-product average.)
(c) Textile employment increased each year from 1963 to 1965 by a small percentage, but "unemployment associated with the textile industries" ¿ccreased much more sharply. (I am not sure what this implies.) The average wockly earnings in vills increased from 1961 to 66 by more than the average for all industries; the rate of increase of earnings in apparel industries was slightly below the average, but was still substantial.
(f) Cotton fabric prices rose even after 1963, when the price of raw cotton fell, and apparel prices have risen steadily, particularly in 1965 and 66 whan imports were greatest. (The fall in man-made yarn and fabric prices is due to increased output and efficiency.)
(c) Imports increased sharply from 1961 to 1966, though by nuch less (in volume) than the increase in donestic production. They dropped in 1967 in line with a levelling out of the U.S. economy, but must be expooted to pick up again. The impact of inports varies greatly by product - e.g. a flood of a particular low-priced low-quality item may be critical to a small. enc-product concern, while other imported items may compete with no one. The impact also varies rocording to whether denend is strong or slack, and to how static the output of domestic producers is at the time,
(a) A falling off of business may be due to many factors besides imports e.g. failure to adjust to changes in techmology, changos in tastes and fachions, a shift in preferred fibro composition, competition from non-textile products, etc.
(2)
To the extcat (which is unknown but assumed to be considerable) to which low-cost imports are bought by low-income consumera, any inport restriction which raised prices would act as a tax on then,
(3) (A warning by Corzissionar Clubb.) Attempts by the government
e.g. fibre producers - may adversely to help one sector of tho economy
affcot other sectors.
T
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