CONFIDENTIAL
Importation of labour
12.
In the present situation, with Hong Kong's economy working close to full capacity, the importation of labour from China (or elsewhere) would be unlikely to displace any local residents from their jobs. However, it might tend to reduce the level of wage increases being gained by local workers. In a recession, imported labour would be competing for jobs with local workers and, to the extent that imported labour might be more willing to accept lower wages, would tend to
displace local workers.
13.
Importing Chinese labour should make it
possible for the economy to produce more but would in all probability reduce the growth rate of output per employee rather than increase it. Thus, although employers' profits might well improve as a result of
importing Chinese labour, it is likely that there would be no improvement in living standards, in terms of income per head. An influx of labour would also put additional demands on social services and meeting them would put an additional strain on the economy.
Provision of Training for Chinese Technicians
14.
The provision of training is not objectionable in principle but details would need to be worked out in terms of numbers, periods of training, a system for return, etc. For example, a large number of unskilled labourers sent ostensibly for training, even though they are rotated and replaced, would have the same effect as
the permanent importation of that number of unskilled
labourers.
Chinese Enterprises in Hong Kong
15.
China's involvement with Hong Kong's economy
is dynamic and substantial.
The general trend has been
/contd......
CONFIDENTIAL
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