TNAG-1873-FCO40-2661-Relations-between-Hong-Kong-and-China-1989 — Page 163

1

CONFIDENTIAL #

CRC INF 14/88

(CEC 8/88)

Economic development in Guangdong

and its implications for Hong Kong

-

Executive Summary

(paragraph references refer to the main paper)

Guangdong's economy and industrial sector

(a) Historical growth performance

Guangdong's economy has been growing rapidly in the 1980s and Guangdong was the fastest growing province in terms of gross industrial output both in 1987 (29.5% in real terms over 1986) and the first half of 1988 (31.1% in real terms over the first half of 1987) (paragraphs 3 and 6). Since 1986 Guangdong has become the top exporting province in China although its national income is only the third largest. In 1987, Guangdong's exports amounted to US$5.5 billion, about 16% of the national total

(paragraph 5). About one quarter of Guangdong's industrial output in 1987 was exported (paragraph 6).. Guangdong's economic success in the 1980s is often attributed to its geographical location and its generally favourable treatment in terms of policy by the central government which enables it to capitalise fully on this

(paragraph 7).

2.

(b) Foreign investment

Foreign investment plays an important role in

It is estimated that Guangdong's economic development.

G.F. 326

CONFIDENTIAL ##

12