TNAG-2621-FCO40-3812-Visits-by-Alastair-Goodlad--Minister-of-State-for-Foreign-an-1992 — Page 157

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YOUR TELNO 764 TO HONG KONG: MR GOODLAD'S VISIT: 25-28 MAY 1992

BRITISH BUSINESS PROSPECTS

SUMMARY

1.

ITS

HONG KONG IS A VERY IMPORTANT MARKET FOR UK EXPORTS. SIGNIFICANCE IS GROWING RAPIDLY. THE OPPORTUNITIES, PARTICULARLY IN AREAS RELATING TO MAJOR PROJECTS, ARE ENORMOUS BY ANY STANDARD. GIVEN THE SIZE OF THE PROJECTS, EVEN LIMITED SUCCESS WOULD HAVE A BENEFICIAL IMPACT ON THE BRITISH ECONOMY.

DETAIL

2.

HONG KONG WAS THE UK'S FIFTEENTH LARGEST MARKET IN 1991, UP FROM EIGHTEENTH POSITION IN THE WORLD LEAGUE TABLE FROM THE YEAR BEFORE. UK EXPORTS TO HONG KONG FOR 1991 WERE POUNDS STERLING 1.38 BILLION, UP 12 PER CENT FROM THE PREVIOUS YEAR AND CONSIDERABLY MORE THAN OUR EXPORTS TO INDIA OR AUSTRALIA AND FOUR

TIMES AS MUCH AS TO CHINA.

3.

A MAJOR CONTRIBUTING FACTOR TO THE BOOM IN HONG KONG IS THE RAPID INDUSTRIALISATION OF GUANGDONG PROVINCE. NOWHERE ELSE IN THE WORLD DOES AN ADVANCED AND WEALTHY INDUSTRIAL SOCIETY SUCH AS HONG KONG, HAVE AN UNLIMITED POOL OF LOW COST LABOUR (10 PER CENT OF HONG KONG'S) JUST 20 MILES AWAY AS FOUND IN GUANGDONG. THIS ENABLES HONG KONG TO REMAIN INTERNATIONALLY COMPETITIVE. HONG KONG'S SERVICE SECTOR ALSO, A SECTOR WHERE UK FIRMS ARE STRONGLY REPRESENTED, SEES EXCELLENT OPPORTUNITIES IN PROVIDING FINANCIAL AND OTHER SKILLS TO SOUTHERN CHINA.

4. 1992 HAS GOT OFF TO A GOOD START. GEC ALSTHOM RECENTLY WON A POUNDS STR 550 MILLION CONTRACT TO EQUIP A NEW POWER STATION IN THE PEARL ESTUARY IN CHINA A FEW MILES FROM HONG KONG AND CATHAY

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