TNAG-0621-FCO40-769-Budget-of-Hong-Kong-1977 — Page 18

GR 2500

PRIORITY

EN CLAIR

FM HONG KONG 921000Z

UNCLASSIFIED

RECEIVED IN

RE

No. 01

7 MAR 1977

1007

LKK

16

PA

TO PRIORITY F C O TELNO 214 OF 2 MARCH

INFO PRIORITY HONG KONG GOVERNMENT OFFICE LONDON, WASHINGTON (FOR

HERMANN), BRUSSELS (FOR BURGESS) AND GENEVA (FOR PEARSON).

THE FINANCIAL SECRETARY, IN MOVING THE APPROPRIATION BILL FOR 1977 IN LEGISLATIVE COUNCIL THIS AFTERNOON, MADE THE FOLLOWING

POINTS:

PART 1: PRESENT ECONOMIC POSITION

1. THE FOUR YEARS 1973 TO 1976 SPAN A CLEARLY DEFINED CYCLE OF

ACTIVITY. REAL GROSS DOMESTIC PRODUCT (1966 PRICES) GREW BY 23%

FROM 1973 TO 1976, ALTHOUGH THE GROWTH RATE IN INDIVIDUAL YEARS

VARIED FROM 14% IN 1973, TO BETWEEN 2 AND 3% IN 1974 AND 1975, TO AN ESTIMATED 16% IN 1976.

2. THE RECESSION IN HONG KONG WAS RELATIVELY SHORT LIVED. COMPETIT-

IVENESS WAS RESTORED AND THIS CONTRIBUTED TO THE 43% INCREASE

ACHIEVED IN THE VALUE OF EXPORTS IN 1976, TO THE REDUCTION OF UNEMPLOYMENT TO ITS FULL EMPLOYMENT LEVEL OF AROUND 4 1/2% AND TO

THE INCREASE IN NOMINAL WAGE RATES BY 16% IN THE YEAR ENDING

SEPTEMBER 1976.

3. THE PRELIMINARY ESTIMATE OF G.D.P. FOR 1976 AT CURRENT MARKET

PRICES IS DOLLLARS 47.1 BILLION WHICH IS 26% HIGHER THAN THE

PROVISIONAL ESTIMATE FOR 1975 OF DOLLARS 37.4 BILLION.

THE PRELIMINARY ESTIMATE OF REAL G.D.P. FOR 1976 1S DOLLARS 23.6 BILLION (+16%)

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/PART 11: THE