CONFIDENTIAL
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Chinese help they produced an immediate and very marked improvement.
4. Since the prospect had been grim it is an enormous relief that so far the new deterrents appear to have worked. But rural unemployment and post-Mao relaxation of discipline and morale continue, as does the wish to come to Hong Kong and it seems inevitable that this year will see determined attempts to circumvent the restrictions.
5.
These events overshadowed the continuing problem of Vietnamese boat refugees. 50,600 were awaiting resettlement overseas at the beginning of the year and 21,600 at the end of it. These included 4,900 who had arrived during the year. Provided current rates of resettlement, particularly by the US are ma intained, and there is no further_influx, 1981 should see an end to this problem. But US help is likely to depend on the United Kingdom also continuing a resettlement programme, however modest. I have urged the importance of this on the department.
Bold The Economy
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26. Immigration over the last 2 years produced about 300,000 more people to feed, house and care for than forecast. It was therefore a relief that for much of the year the economy was active with a growth rate of about 9% in real terms for the year as a whole. Nevertheless it is illustrative that the growth rate in domestic exports dropped from 18% in real terms in the first half to about 6% in the second. The distribution within industry was uneven with some sectors like garments and watches continuing to ga in and others like spinning and weaving to decline. tertiary sector continued to grow.
The
7. There was a very strong and to some extent speculative demand for real estate and a high level of construction. These reflect the market's view of Hong Kong as a place for business or residence. But there have been disruptively steep rises in the level of commercial rents and rents for new flats (domestic rents of sitting tenants are controlled). Parallel to the real estate boom there was a boom on the stock market with the Hang Seng Index rising from 879 to a high of 1655 during the year.
CONFIDENTIAL
/ 8. In sombre
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