TNAG-1873-FCO40-2661-Relations-between-Hong-Kong-and-China-1989 — Page 79

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

CONFIDENTIAL ☀

26

t

million for re-development.

Third, a PRC-interest

financial group was reported to have taken part in the buying of a group of old but re-developable buildings in

Wan Chai and Tsim Sha Tsui involving a total stake of

HK$200 million.

40.

Apart from these realised investments, China

Merchants Holdings Co. Ltd. made known its intention to

bid for Container Terminals 8 and 9 and Guangdong

Enterprises expressed keen interest in developing the site

currently occupied by the desalination plant at Castle

Peak into a wharf and godown area. It is estimated that

the latter project, if realised, would involve a total

stake of HK$10 billion.

(V) Concluding remarks : implications for Hong Kong

41.

China's economy remained buoyant in the fourth

quarter of 1988. Although the rate of inflation showed

the first signs of peaking in the last three months of

1988, inflation remained China's most important economic

problem. However, the economic forecasts for 1989 put

forward by the State Council reveal a general concensus among the Chinese leaders for maintaining a reasonable

rate of growth in 1989. In other words, sacrificing most

of the growth for the sake of price stability is

apparently not considered desirable.

42.

Despite the high rate of inflation in China, the

prices of imports from China remained fairly stable in

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