TNAG-1646-FCO40-2293-Chinese-investment-in-Hong-Kong-1987 — Page 45

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CONFIDENTIAL * *

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Table 7

response, and the prices fetched (in respect of

comparable lots) were appreciably higher in the

second half of 1986 than in the first half. This

suggests that developers were generally optimistic

about the outlook of the property market for 1987,

and probably 1988.

22.

The take-up of sites in the two Industrial

Estates at Tai Po and Yuen Long remained at a high

level in 1986 (Table 7). In October 1986, the Hong

Kong Industrial Estates Corporation raised the

standard land prices for sites in these two estates,

in view of the firming up in land and property prices in respect of industrial accommodation in the

private sector.

Feedback from Industry Department

23.

Some qualitative information on investment

was obtained recently by the Industry Department

during regular factory visits and from general

contacts with industrialists. The information,

which is largely subjective, is summarised below:

(i) Many garment and textiles factories have

invested substantially in new computerised

automatic machines, mostly made in Japan,

in order to increase their productive

capacity. This is partly because of the

need to cope with a larger volume of orders, and partly because of the effect

of the US country-of-origin rules, which

have limited the extent of outward

processing in China;

G.F. 326

CONFIDENTIAL #3

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