TNAG-1603-FCO40-2210-Future-of-Hong-Kong-annual-reports-to-Parliament-on-Hong-Kon-1987 — Page 225

(c)

Trade relations

51.

Hong Kong's

term Longer

economic performance

remains

dependent on external forces. The threat of protectionism in Hong

Kong's

major

export

markets,

particularly

the

United

States,

remains. While prospects for exports to China appear good in the

Longer

China's modernisation programme, Hong Kong's term, given

and domestic

China have exports tighter Chinese control on imports since April 1985.

52.

re-exports

to

been

affected

by

The Hong Kong Government will continue to make every effort counter protectionist pressures and to defend Hong Kong's trading interests. The past year has seen the satisfactory conclusion of several new agreements of vital importance to Hong Kong's textiles

the

of include These and

industries. garments Multi-Fibre Arrangement until July 1991 and bilateral agreements textiles with the United States and with the European Community.

53.

A s

extension

a

the

on

from 23

been 1986 April

has Hong Kong

separate

contracting party to the General Agreement on Tariffs and Trade and, in that capacity, has supported the launching of the Uruguay round In the forthcoming of multilateral trade negotiations in November.

to efforts to lend particular support discussions Hong Kong will bring about trade liberalisation and improved market access: considerable interest in negotiations on trade in services, a of growing importance to the Hong Kong economy.

it has

sector

(d)

Public Finances

54.

to surplus in the The Hong Kong Government budget returned

For of

the three financial

deficits. after year 1985/86

years financial year 1986/87, higher yields from earnings and profits tax are expected, and the income from land sales will also be higher

On the basis of present

surplus

trends a significant

close of the current

improvement in the

is Likely at the

financial year.

Nevertheless, the Hong Kong Government will continue to keep public contain the size of the

16% of the about

gr

This will be achieved through prudent management

expenditure firmly under

to control and

· public

sector, presently equivalent to

domestic product.

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