28-01-83 10.27 FROM.
IF 1 H.M.TREASURY
ID.
0712706329
13.
demands from this investment will fall on th construction industry, which is showing some slack at present. In addition, there is likely to be significant leakage through imports of plant and equipment, while contractors working on airport and related projects will be permitted to import labour under the special labour importation scheme. The continuing shift of manufacturing capacity to southern China, which will help to release labour in Hong Kong to meet other demands, will alsu lessen the impact of the change in the fiscal position.
The authorities point out that the new airport is needed to replace the existing Kai Tak airport which is expected to reach its design capacity by end-1994. The project is a once in a generation event. In their view it would not be desirable to finance this exceptional project at the expense of other public services. The fiscal reserves at 31 March 1992 stood at a historically high level of $99 billion, and they believe it is only reasonable that the Government should apply some of these accumulated reserves to fund the construction of the new airport and its related projects, which are an essential public investment in Hong Kong's economic future.
Trade Issues
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The Hong Kong authorities continue to place heavy reliance on the effective functioning of the multilateral trading system. They remain concerned about the increasing incidence of unfair dumping accusations by their trading partners. The authorities are also keeping a close watch on the development of regionalism and trade blocs (e.g. North America Free Trade Agreement and the Single Market in Europe) which may affect the growth and liberalisation of world trade.
Finally, the Hong Kong authorities welcome the fact that the Article IV consultation arrangements for Hong Kong have reverted to a 12-month cycle.
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