TNAG-1393-FCO40-1865-Future-of-Hong-Kong-briefing-for-meetings-and-visits-1985 — Page 53

investing in assets overseas.

assets

last count.

As

+

result, the UK's net overseas

risen from $25 billion in 1979 to $85 billion at the

Regrettably:

countries, the

continued to suffer from high levels of unemployment. Rigidities

in the labour market rerain a problem; but it has to be

to be said,

too, that management has not always been quick enough to adapt to the improvements that have taken place. Eevertheless, employment levels have been rising, and unemployment would have fallen is it had not been for a rapid expansion of the workforce.

In the industrial world as a whole, growth is becoming more balancei between the different countries. But major imbalances of kinds remain, notably that arising from the size of the US Budget

deficit in relation to its domestic savings ratio. Partly as

a result of this, we have seen large and disturbing morements

in the relative values cf currencies, with inevitable undesirable effects on trade performance. This is the backgro

to the first of the main threats to our continued progress.

Protectionism

The rise of protectionist pressures is the major and cost immediate danger to the world economy. Protectionist sentiment has been increasing in Europe, and even more so in the United States. extent of those pressures is reflected in the long catalogue measures under discussion in the United States Congress.

We

the applaud

way in

the which

and welcome

United

Administration has resisted such proposals and its deter

to continue to do so.

remind ourselves of

We cannot too often

the damage” dona

escalation of barriers to international trade, the effect is to reduce growth in industrial countries, to limit opportunities, and to deprive developing countries of export which are vital to their prospects, especially for those

with the problems o