TNAG-1483-FCO40-2037-Economic-situation-in-Hong-Kong-1986 — Page 175

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22.

After a sharp decline in the early months of

this year, re-exports have recovered significantly in

more recent months. They now show zero growth in the

first half of the year. As China steps up its efforts

to promote exports, re-exports to other markets of

goods originating in China are expected to continue to

grow rapidly in the second half, although re-exports

to China are likely to show a sharper decline than the

budget forecast. Re-exports as a whole are thus

expected to grow by 6% in 1986,

1986, up from

up from the budget

forecast of 4%.

1

23.

thus

The forecast growth rate of total exports is

8% up from the budget forecast of 6%. This

upward revision has a significant positive effect on

the forecast of GDP growth.

24.

The relatively high growth rates of retained

imports of foodstuffs and of

in the first half of the

consumer goods recorded

year

13% and 10%

-

suggest that private

consumer demand

respectively

has

remained reasonably firm. The latest figures on

retail sales also indicate an improvement in the

demand for some consumer items such as foodstuffs and

clothing. The budget forecast growth rate of 3.5% for

private

consumption

expenditure now

/conservative

appears