China now takes.
UK EYES A
$346 million in 1976. This figures does not however reflect the total of Ci...ese
"invisible" earnings through Hong Kong since the Chinese banks may be building up their
Hong Kong dollar holdings (for example by increasing direct investment and/or Hong Kong
dollar lending activity) rather than purchasing foreign currency. Furthermore the banks can acquire foreign currency, other than Hong Kong dollars, through remittances from Chinese outside Hong Kong and through direct US dollar deposits which the Bank of Secret intelligence indicates that the "invisibles"
earnings in 1976 were probably in the region of $600 million (of which $400 - 450
million was contributed by remittances) and independent analysis in Hong Kong has
also estimated China's invisible earnings at up to $700 million in 1976. We believe
the figure of $600-700 million to be a reasonable approximation of China's gross
"invisible" earnings in Hong Kong and that the currency purchases figure represents
a net figure ie that proportion of China's foreign exchange gained through Hong Kong
that China chooses to convert from Hong Kong dollars into other convertible
currencies.
4.
Proportion of Total Foreign Exchange Earnings. The value of Hong Kong to China
in financial terms is often expressed as the proportion of China's total foreign exchange
earnings that is acquired through its economic relationship with Hong Kong.
A calculation of this proportion is shown below in Table I.
TABLE I
HONG KONG FOREIGN EXCHANCE EARNING
EARNINGS FOR CHINA
(US million)
1972
% 1973
4/
1974 % 1975 %% 1976 % 1977
exchange earnings (gross) 2840 100|4380 1005670 1005920 10015880
5880 100
China's total foreign
Of which:
Exports to Hong Kong contributed:
528 19 816
19 899
161060
18 1142 19 1253
Reexports through Hong
157 6
278
6 281
55
318
5 441
Kong contributed:
8
481
"Invisibles" from Hong
Kong contributed (net): 496 17 426
Total Hong Kong earnings
1181 42 1520
2srxped
Note:
Source: Hong Kong Government Secretariat.
321779 30 1929 33
Re-exports are shown/c.i.f. value as they enter Hong Kong
2
UK EYES A
THIS IS A COPY
THE ORIGINAL HAS BEEN RETAINED IN THE DEPARTMENT UNDER
SECTION 3 (4) OF THE PUBLIC RECORDS ACT 1958
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617
11 401 7|| 346
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