TNAG-2127-FCO40-3037-Investment-in-Hong-Kong-1990 — Page 71

CONFIDENTIAL

FM TOKYO

TO IMMEDIATE FCO

TELNO 936

OF 22033OZ OCTOBER 90

INFO IMMEDIATE HONG KONG

INFO ROUTINE BTC HONG KONG

FOR PAUL, HKD

CONFIDENTIAL

Haz 1212

Нич

Im

W

162731

MDHIAN 5266

TOP COPY Q DIST?

1990

YOUR TELNO 1907 TO HONG KONG:

IN HONG KONG

SUMMARY

1.

JAPANESE INVESTMENT

STATISTICS SHOW JAPANESE INVESTMENT WAS STRONG THROUGH 1989. GENERAL IMPRESSION HERE IS THAT THIS INTEREST CONTINUES AND IS UNAFFECTED BY 1997.

DETAIL

2.

WE ARE SENDING BY FAX TO HKD AN UPDATE OF THE MINISTRY OF FINANCE STATISTICS TOGETHER WITH ADDITIONAL TABLES GIVING A BREAKDOWN BY INDUSTRIAL CATEGORIES OF JAPANESE INVESTMENT IN HONG KONG, SOUTH KOREA, SINGAPORE AND TAIWAN FOR FINANCIAL YEARS 1986-1989. MANUFACTURING INVESTMENT IN HONG KONG OVER THESE FOUR YEARS WAS DOLLARS 52 MILLION (FY 1986), DOLLARS 108 MILLION (FY 1987), DOLLARS 85 MILLION (FY 1988), AND DOLLARS 116 MILLION

(FY 1989) RESPECTIVELY. REAL ESTATE INVESTMENT WAS DOLLARS 51 MILLION (FY 1986), DOLLARS 243 MILLION (FY 1987), DOLLARS 186 MILLION (FY 1988), AND DOLLARS 528 MILLION (FY 1989). (JAPANESE FINANCIAL YEARS RUN FROM APRIL TO MARCH THE FOLLOWING YEAR: NO MORE RECENT FIGURES ARE AVAILABLE). THIS SHOWS THAT UNTIL RECENTLY, AT LEAST, INVESTMENT HAS BEEN INCREASING. THE SAME IS TRUE FOR JAPANESE INVESTMENT IN SINGAPORE AND TAIWAN BUT NOT FOR SOUTH KOREA WHERE MANUFACTURING INVESTMENT HAS REMAINED LEVEL FOR THE LAST THREE YEARS.

3.

THE HONG KONG TRADE DEVELOPMENT COUNCIL HERE SEE NO REAL EVIDENCE THAT JAPANESE COMPANIES ARE PUT OFF BY 1997.

THEY SAY THAT THE JAPANESE NOW TREAT HONG KONG FROM AN INVESTMENT POINT OF VIEW AS IF IT WERE PART OF CHINA. THEY NOTE THAT MAJOR JAPANESE RETAILERS ARE CONTINUING TO EXPAND IN HONG KONG AND THAT SINCE THEIR MARKET IS THE

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CONFIDENTIAL