TNAG-2599-FCO40-3787-Appointment-of-Chris-Patten-as-new-Governor-of-Hong-Kong--Ap-1992 — Page 102

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constraints on the development of the Hong Kong economy. Labour intensive

jobs have been exported to the Mainland and Hong Kong itself is focusing

more on developing its service industries.

Meanwhile, Hong Kong has also resumed its original role of facilitating

trade with China. The Colony was created in the 19th century for that

very purpose. For political reasons, both in China and the West, this was

not possible from the 1950s to the 1970s but, with the death of Mao Zedong

and the downfall of the Gang of Four, China reopened its doors to the

outside world and Hong Kong, after an interruption of three decades, is

once again playing its historical role.

trade has grown, the re-export trade

of China

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Much as Hong Kong's domestic

mostly goods passing into and out

has grown even more. In 1981, Hong Kong's domestic exports

amounted to HK$80 billion (thousand million), whereas re-exports were

about half that amount. Ten years later, domestic exports had almost

tripled. But re-exports had grown 13-fold so that, in 1991, re-exports

were more than double the value of the territory's domestic exports. This

shows, quite dramatically, that Hong Kong is again playing the role of

facilitator of business between China and the rest of the world. Hong

Kong and China are now each other's largest trading partner.

China accounts for 10.6 per cent of overseas investment in Hong Kong's

manufacturing sector, exceeded only by Japan, with 31.5 per cent, and the

United States, with 30.6 per cent. Britain is in fourth place, with 7.1

Moreover, more than 600 foreign companies have their regional

headquarters in Hong Kong.

per cent.