TNAG-1873-FCO40-2661-Relations-between-Hong-Kong-and-China-1989 — Page 139

FCO40 Hong Kong Department Records 聯邦事務部香港部檔案 All

GF 323

CONFIDENTIAL #

18

there were serious shortages of key industrial raw

materials including rolled steel, metal products,

chemicals and construction materials.

28.

There is a concern that the recent rectification

campaign may have adverse implications on economic

development in Guangdong. For instance, if the State

Council's decision in October about setting price ceilings

on the above-state-quota production of essential raw

materials like copper and steel is effectively carried

out, it will hit Guangdong hardest because compared with

most other provinces, Guangdong has de-regulated so much

that about 70% of its raw material prices are now

determined by market forces. Also Guangdong's

achievements are envied by many inland provinces which

accuse the central government of giving it an unfair advantage by granting it economic autonomy.

29.

The economy of Shenzhen City (including the

(21) Special Economic Zone) recorded rapid growth in the first three quarters of 1988. During this period gross industrial output amounted to Rmb 5.95 billion (+50% over

the same period in 1987) and retail sales to Rmb 3.72

billion (+79.1%). Of the industrial output produced in Shenzhen in the first three quarters of 1988, about 51.5% or Rmb 3.07 billion was exported. This was 53.9% higher than in the same period last year. In the first eight months of this year, Shenzhen signed 403 contracts with foreign investors (+67.2% over the same period in 1987) involving a total contracted value of US$264 million

(21) The Shenzhen Special Economic Zone (SSEZ) is part of

Shenzhen City. The statistics reported here are at current prices and refer to the City as a whole. But the share of the SSEZ in these totals is believed to be pre-dominant.

CONFIDENTIAL

機密

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