TNAG-1632-FCO40-2248-Ministerial-visits-from-the-UK-to-Hong-Kong--including-visit-1987 — Page 118

JOGACT

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VISIT TO HONG KONG BY LORD GLENARTHUR, 16-19 SEPTEMBER

BACKGROUND BRIEF C: UK/HONG KONG TRADE

1.

Hong Kong is the UK's seventeenth largest export market, and

the second largest in the Far East only just behind Japan. UK exports to Hong Kong in 1986 were £961m - a 1% increase over 1985

and in Jan-June 1987 were £492m an 11% increase over the same

period in 1986.

2.

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The UK's share of the Hong Kong market has declined gradually

in recent years.

At end-1986 it was 3.4%, and in Jan-May 1987 was

3.2%. The UK is the sixth largest supplier. Our principal exports are capital goods: power generating equipment; electrical machinery, vehicles (buses and rail cars). The UK has traditionally performed

well in Hong Kong's project sector: the Castle Peak power stations

were built by GEC (with Babcock); Babcock built the Town Gas plants (phase 1); and GEC and Metro-Cammell worked in unison on the Mass

Transit Railway. More recently Davy Morris won an order to supply

cranes for the container port. The UK also sells leather and fur in

significant quantities.

3.

Bilateral trade is in favour of Hong Kong. UK imports from

Hong Kong in 1986 were £1,531m, giving Hong Kong a surplus of £570m. Imports from Hong Kong in Jan-June 1987 were 640m a 12% increase

over the same period in 1986.

4.

Within the EC the UK is Hong Kong's most important trading

partner, followed by the FRG.

5.

UK companies (banks, accountants, insurance brokers and solicitors) have a large presence in Hong Kong's "invisibles"

sector. Revenue accruing to the UK from "invisibles" is estimated to be approximately equal to the value of the UK's visible export to

Hong Kong.

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