CONFIDENTIAL
HK$98 bn. Government expenditure to increase by 6% in real terms in 1992/93 and Government expenditure to take up 18.8% of GDP (cf 17.8% in 1991/92). Few notable revenue measures: an increase in profits talk from 16.5% to 17.5% elimination of tax on soft drinks and cinema tickets (to
help inflation); increases in tax on alcohol, tobacco etc to retain the real yield.
Inflation and the Economy
The recovery in the economy continues. Inflation currently running at 10.3% down from 12% in 1991. Efforts by Hong Kong Government to combat inflation, eg property market price stabilisation and labour import scheme seem to be working. Total exports in 1991 increased by 20% over previous year, imports by 21%, and re-exports increased dramatically by 29%. There was a small trade deficit of HK$1.68 bn.
Jardines
Jardines have accepted the offer of a "secondary" listing on the Hong Kong Stock Exchange (HKSE) rather than a "trading only" listing as originally discussed.
HKSE has submitted its proposed changes to the listing rules to facilitate secondary listings for companies, which like Jardines have the majority of their trading on the HKSE. SFC have suggested certain amendments to which the SEHK response is favourable. Proposals have still to be put to Jardines.
- On the question of the application of the Takeover Code Jardines have accepted that this needs to be worked out with the SFC in private discussion leading to an agreement by the end of 1992.
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CONFIDENTIAL
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