TNAG-2791-FCO40-4030-Relations-between-Hong-Kong-and-China.-With-maps-1993 — Page 25

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of the service

items

which showed

greater

price

increases (14) tended to be consumed more in the cities

than in the rural areas.

10.

the

(c) External sector

According to

value of the

China's customs statistics, in 1992

country's total visible trade reached

US$165.6 billion, representing an increase of 22.1% in US dollar terms over 1991. At this value, China had overtaken

Spain, Taiwan and South Korea to become the eleventh largest trading entity in the world, just one place after

Hong Kong. In 1991, China ranked the fifteenth in the world trade league. Enterprises with foreign investment

accounted for 26% of China's total trade. The value of

trade by these enterprises rose substantially by 51% over 1991 to US$43.8 billion. Analysed by the trade aggregates,

in 1992 China's exports grew by 18.2% to US$85.0 billion,

while its imports grew even faster, by 26.4% to

US$80.6 billion. The latter increase was attributable to a

surge in China's own demand for imports, which was reinforced by the relaxation of its import controls (15). In particular, there was a strong demand for raw materials

and capital equipment

equipment arising from the investment boom.

Consequently, China's visible trade surplus narrowed

substantially to US$4.4 billion in 1992, from US$8.1

billion in 1991.

•

(14) The price index for services rose by 13.4% in 1992. The sub-index compiled for the 35 major cities rose even faster, by 21.3%.

(15)

China announced that, with effect from 31 December 1992, the tariff rates on 3 371 imported commodity items would be lowered by an average of 7.3%. These items included (i) raw materials such as fuel oil, timber, cast iron, dyes, etc; (ii) hi-tech products; (iii) products from developing countries; and (iv) products in which local producers in China are fairly competitive, like garment and footwear.

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