TNAG-1842-FCO40-2617-House-of-Commons-Select-Committee-on-Foreign-Affairs-enquiry-1989 — Page 105

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J. HONG KONG ECONOMY AND TRADE

1. Hong Kong Economy

ECONOMIC DEVELOPMENTS DURING AND AFTER NEGOTIATIONS ON JOINT

DECLARATION

Hong Kong dollar exchange rate provided clearest measure of

Declined 15% uncertainty during negotiations on Hong Kong's future. in two days in September 1983 prior to rate being linked with US dollar in October 1983. Rate has remained steady since at about

HK$7.80=US$1.00.

Confidence in Hong Kong illustrated by more than doubling of investment in capital goods since 1983.

1985.

Stock market very flat in 1982-84 period. Picked up by 50% in

SIGNS OF BOOMING ECONOMY

In 1988 In 1986 and 1987 growth rates was in double figures. economy grew at 7.5% in real terms (compared to 14% in 1987). 6% growth projected for 1989.

Per capita GNP highest of Asian Newly Industrialised Economies

Has also overtaken some OECD (Korea, Singapore, Taiwan) in 1987. countries such as New Zealand.

Unemployment rate at record low of 1.3% in the third quarter

1988.

Property prices remain firm.

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