TNAG-0574-FCO40-707-Hong-Kong-annual-review-for-1975-1976 — Page 19

25 JANI76

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FOREIGN AND Rouch ONWEALTH OFFICE

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DIPLOMATIC ARPORT NO. 167/76

FCO(S) WHT(3) Distribution

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HONG KONG: ANNUAL REVIEW FOR 1975

SUMMARY Than

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25 January,

1976

1. Hong Kong came through the recession, but it Hone KONG

was a most anxious time/ (Para, 2).

2.

3.

4.

5.

6.

7.

8.

Measures to strengthen the community of Hong Kong; they helped Hong Kong to weather the recession/

(Para, 3).

The fight against crime is showing some signs of success, and the rapid rise in the crime rate over the last 8 years was halted, (Paras, 4 and 5),

Throughout the year the attitude of Peking was friendly and helpful. The new relationship evolved between Hong Kong officials and Communist Chinese officials. The Royal Visit set the seal on the status quo. The position now reached though full of oddities, should only be changed gradually and unobtrusively, if at ally

(Parás 6-8).

Relationship between Hong Kong and United Kingdom - the minor irritants have been

Defence Costs, industrial competition, corruption and lack of information in the United Kingdom about the Hong Kong scene. How these issues have been tackled in the past year, (Parás,

9-16),

Misconception that the Colony represents a loss to the United Kingdom. When invisibles are included the balance is already in the United- Kingdom's favour, and it could be increased (Para, 15).

The recession in Hong Kong was sharp and deep and in March 10% of the work force was probably unemployed. Recovery has been fast in the last quarter, unemployment has dropped and incomes are rising. The current mood is one of confidence, though the future depends on the recovery of markets in America and Europe, Paras, 16-18)

Inspite of the recession, resources were found to maintain progress in the major social programmes, but some re phasing was necessary. We hope to pick up speed again in 1976 and be back on course

(Paras 19 and 20).

by 1977,

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