TNAG-1136-FCO40-1416-Address-by-Sir-Edward-Youde--Governor-of-Hong-Kong--to-the-L-1982 — Page 92

M

12.

Navertheless continuing growth even at a reduced rate has meant that we appear to be avoiding serious unemployment. The unemployment rate in Mazch this year was only 3.5%, significantly less than the 4.19 recorded at the same time last Some factory workere are working shorter hours in view of the sluggishness of export demand but the manufacturing @actor as a whole is not shedding labour on any substantial | oçala. Wages and salariog have increased

increased all round in real

terug, partly because the rate of inflation has fallen.

year.

13.

Inflation is now running at about 11% per

annum in

terms of consumer prices, after remaining at around 15% for two

This trond years.

а is partly

reflection of the general

slowing down in the rate

in the rate of world inflation, but favourable developmenta within the economy have also contributed. The prescure of demand on domestic resources has moderated. The growth rates of the money supply and of credit have slowed downi. Interest rates have eased significantly. Stable

falling prices and lower rontals for property have also contributed to easing inflation, but I realise that, should the

exchange value of the Rong Kong dollar weaken further

| inflationary pressures will reappear.

(b) The Public Finances

Or

14.

This reduced growth rate of our economy will have its effect on the public finances. Revenue collections so far this

year have not reached expectations, due largely to shortfalls in the yields from land sales, and earnings and profits tax. Total expenditure is higher than estimated due partly to the

purchase of more land than expected and other unavoidable

capital expenditure, but mainly to the

the annual adjustment to

civil service. pay. It now

socas unlikely that this year the | budgetted surplus of $2.3 billion will be achieved, and present indications are that this year's accounts will only break even.

/15.

mye

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