TNAG-0570-FCO40-703-Planning-paper-on-Hong-Kong-1976 — Page 155

SECRET

10.

commercial benefits to the U.K. Direct British investment

in manufacturing industry is very small (about £14 m in

1974) and much smaller than similar investment by the

United States (£40m) and Japan (£30 m) but there

are important British financial and commercial investments

for which no figures are available. The British share

of the Hong Kong market for imports (£157m in 1975) was

only 6% of the total as compared with Japan (21%)

and the United States (14%). Hong Kong accounted for

only 0.8% of total British exports and is declining

as a percentage of the total. Hong Kong exports to

Britain in 1975 were valued at £307m, 9% of total Hong

Kong exports, producing a deficit for Britain in the

balance of trade of £150m. A Hong Kong estimate of the

net value to Britain of the trade in invisibles is £129m

annually; but the Central Statistical Office are unable

to confirm this because of conceptual and practical

difficulties in producing detailed balance of payments

estimates on a bilateral basis. The United Kingdom gains

special advantages from the connection with Hong Kong:

it is an important bargaining counter in air services

negotiations

THIS IS A COPY

THE ORIGINAL HAS BEE

RETAINED IN THE DEPARTMENT UNDER SECTION 3(4) OF THE

PUBLIC RECORDS ACT 1968 |

Britain

enjoys substantial advantages in the long Kong market over

most of her competitors. The administrative structure

is British; the main langage of government and commerce

is English; the most influential sections of the community

have strong educational, financial and intellectual links