TNAG-1230-FCO40-1543-Visit-by-Richard-Luce--Minister-of-State-for-Foreign-and-Com-1983 — Page 174

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nave not attempted to play a direct role in Hong Kong's political affairs. While it remains the policy of Peking to maintain the stability and prosperity of Hong Kong, the Chinese Communist organisations in the Territory can be relied on not to undermine

government policies.

1.13 The activities of the Chinese Nationalists parallel those of

the Communists but on a very much smaller, and diminishing, scale..

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SECTION 2: THE ECONOMY

2.1 Much of Hong Kong is unproductive mountainland. About 16%,

including areas reclaimed from the sea, is used for residential and

industrial development. Only 9.4% of the land is farmed, producing

vegetables, fruit, flowers, freshwater fish, pigs and poultry. There is a considerable fishing fleet of 5,000 boats, meeting over 90% of local demand for fish. Less than 3% of the population engage

in farming or fishing.

2.2

Hong Kong's principal natural asset is its sheltered harbour, the only developed deep water port on the China coast. From the establishment of Hong Kong as a centre for Britain's Far East trade

in 1841 up to about 1950, trade and commerce was the main economic

activity. Then, when the Korean War brought a slump in trade with

China, it became necessary to develop other sources of income, particularly as the population had expanded rapidly with the influx of immigrants from China at the time of the Communist take-over. Hong Kong therefore turned to manufacturing, starting with textiles

and clothing (which remain the dominant industries), but diversifying later into many other products, including plastics,

electrical and electronic goods, scientific instruments, watches and photographic and optical equipment. The entrepôt trade with China has re-emerged as a significant proportion of Hong Kong's trade in the last few years, and service industries have expanded rapidly as a consequence of rapidly growing domestic incomes and Hong Kong's development as an important financial and tourist centre in the

region.

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