TNAG-1393-FCO40-1865-Future-of-Hong-Kong-briefing-for-meetings-and-visits-1985 — Page 61

BULL POINTS

16 September 1985

Jutput

Between 1974 and 1979 money GDP rose by around 18 per cent per year of which 16 per cent was frittered away in higher inflation and real growth was 2 per cent. During the present upswing 1981Q2 to 1985Q1 annual growth of real GDP has averaged 3 per cent

with inflation under 6

per cent.

GDP at highest ever level. It grew by 21 per cent in 1984 and, adjusting for coal

strike it grew by 31 per cent in underlying terms between 1984Q1 and 1985Q1.

UK growth topped EC growth league in 1983 and, despite the coal strike, grew at the

EC average in 1984. For 1985 OECD expect UK to be fastest growing economy in the European Community UK also expected to grow faster than the United States. Contrast

with 1970's when UK was bottom of Community growth league.

Manufacturing output rose by 4 per cent in 1984 - biggest percentage increase in any year since 1973. In three months to July 1985 manufacturing output was 101 per cent above 1981 first quarter trough.

UK car production rose by 13 per cent between first eight months of 1985 and

corresponding period last year.

Private industrial orders received by construction industry were 25 per cent higher in the second quarter 1985 compared with same period one year ago. Private commercial orders were 8 per cent higher over same period.

a year

UK now into fifth year of uninterrupted growth, at an average rate so far of 3 per cent

for the first time since the 1973 oil shock.

Domestic Demand

Consumers expenditure grew by 2 per cent in 1985Q2. Retail sales up 5 per cent in

3 months to August 1985 on year earlier.

and

Total fixed investment rose by 7 per cent between 1983 and 1984 to reach all time

high of £451 billion at 1980 prices equivalent to £55 billion at current prices

expected to rise even further in 1985.