5. Hong Kong is now an international financial centre, with a highly efficient communications and transport system. Low taxation is the principal stimulus for foreign investment, which the Government welcomes because of the capital, and the technical and managerial knowledge which it brings into the Colony. No distinction is made between local and foreign businesses for tax purposes.
6. At the end of 1978 inflation was running at 6% and unemployment 2.5%.
OVERSEAS TRADE
7. The value of Hong Kong's domestic exports in 1978 was HK$40, 711m (approx £4,285 million). The principal products were: textiles
and clothing (45%), electrical machinery and appliances (12%), scientific, photographic and optical goods (%), and miscellaneous manufactured goods (16%).
8.
Hong Kong's imports in 1978 totalled HK$63, 056 million (approx 26,637 million). They consisted mostly of foodstuffs, raw materials and semi-finished products for Hong Kong's manufacturing industries, fuel and capital equipment. This leaves a considerable deficit on visible trade, which is largely offset by invisible earnings, mainly transport and tourism,
9.
Principal export markets were (1978)
HK million
%%
United States
15,125
37.1
Federal Republic of Germany
4,426
10.9
United Kingdom
3,971
9.5
(EEC countries
10,868)
Japan
Australia
1,856
4.6
1,494
3.7
Principal suppliers (1978) were:
HK million
၄
Japan
14,405
22.8
China
United States
10,550
16.7
7,519
11.9
2
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