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Hong Kong interests.
As regards short-term prospects for exports to China, the strong growth in outward processing activities in the second half of 1986 may not be
Sustainable throughout 1987, in view of an expected
slow-down in the growth rate of Hong Kong's domestic exports to overseas markets, but for the year as a whole
the growth rate in such activities may still be significant. In respect of direct sales to China,
increased efforts at import substitution will limit China's demand for many of the lower-end products
manufactured in Hong Kong. However, exports of more sophisticated products are likely to be sustained.
Meanwhile, Hong Kong's re-exports of China origin are expected to show further increases, given China's
continuing export promotion drive.
49.
A statistical appendix on Hong Kong-China
economic relations is attached.
Economic Analysis Division Economic Services Branch Government Secretariat 23 March 1987
G.F. 326
CONFIDENTIAL #
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