TNAG-1873-FCO40-2661-Relations-between-Hong-Kong-and-China-1989 — Page 93

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

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CONFIDENTIAL

機密

8.

In many respects, the SSEZ has become very much

part of Hong Kong's economic hinterland as it depends on

the latter for the provision of capital, of a market for its products, of technical and other expertise/knowledge, and of managerial support in general (paragraphs 32 to

34).

On the other hand, through investing in and

sub-contracting work to the SSEZ, Hong Kong manufacturers are able to reap the benefits of lower wage rates and, to

a lesser extent, lower land costs in the SSEZ for their

production processes. In so doing, the productive capacity of the manufacturing sector in Hong Kong is effectively enlarged, and Hong Kong's more skilled workforce is made available for higher productivity tasks (paragraph 35).

Economic Analysis Division Economic Services Branch Government Secretariat 17 December 1988

GF 323

CONFIDENTIAL **

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