TNAG-1942-FCO40-2768-Internal-economic-situation-in-Hong-Kong-1989 — Page 5

1

Press Release

(embargoed until 4 p.m. on 24 November 1989)

Economic Situation in the Third Quarter of 1989

and Updated Forecasts of GDP and Prices for 1989

The pace of economic growth continued

to decelerate in the third quarter of 1989, due

to a marked slow-down in both external trade and

domestic demand. The repercussions of the

events in China in early June reinforced the

cyclical downturn of the economy. However,

indicative of continuing constraints on capacity

during the third quarter, the labour market

remained generally tight, and the rate of

inflation was still high.

2.

An analysis of developments in the

third quarter of this year is given in the Third

Quarter Economic Report 1989 published today.

3.

The Government Economist said that on

the basis of the most up-to-date information

available, a further review had been made of the

forecasts of the gross domestic product (GDP)

and of price trends for 1989.