CONFIDENTIAL #Z
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Guangdong's exports through Hong Kong's local transport network into Hong Kong's container port and other shipping outlets. Ports in Guangdong like Huangpu, Shekou and Chiwan all provide feeder services to Hong Kong. recently, the flow of goods in the opposite direction has also become substantial. This flow consists of products made in Hong Kong and, to a greater extent, products from elsewhere which are re-exported to China through Hong Kong.
Economic dependence of Guangdong on Hong Kong
26.
Guangdong's success in the past ten years has depended heavily on Hong Kong with respect to funds for investment, markets for products, expertise/knowledge on production and managerial support in general. Hong Kong is by far the most important source of foreign investment in Guangdong (paragraph 8) and its importance to Guangdong's development can be highlighted by comparison with Fujian Province (paragraph 7). From an economic point of view, Guangdong has become more integrated with Hong Kong through serving as its economic hinterland and is likely to continue to play such a supporting role for a long time in future.
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27.
The Guangdong authorities and enterprises appear to have made some efforts to enhance their industries' external competitiveness in respect of production and marketing with a view to reducing their dependence on Hong Kong. But any progress in this direction takes time and
(32) no major changes are expected in the near future
(32) If the experience of Hong Kong was anything to go by, it takes more than ten years to build up a reasonably large and well developed manufacturing sector.
C.F. 326
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