ENG-1969 — Page 24

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HONG KONG MANUFACTURING INDUSTRY IN THE SIXTIES

internal demand, but on a real and healthy increase in exports'. In saying this, Sir Hugh Norman-Walker highlighted the connection between industry and exports (and he might have added imports as virtually all raw materials have to be imported), which remains the most striking feature of Hong Kong's industrial economy. It is believed that about 90 per cent of the output of manufacturing industry is exported. As this sector of industry plays so central a role, the value of domestic exports remains the best indicator not only of the relative importance and state of individual parts of the manufacturing sector but of the state of the economy as a whole.

Domestic Exports—

1959

1965

1969

$ 2,282 million $ 5,027

$10,518

For two years running the value of domestic exports has increased by approximately 25 per cent compound on what can only be regarded as an already high base for a territory so small in area. Indeed domestic exports have doubled in value in the last three years, having taken the previous six years to achieve the same result. In 10 years the value of domestic exports has increased four times from a high starting figure to over $10,000 million dollars in 1969. What is more, the rate of increase is itself increasing; it took six years for exports to double, and only four years to double again. This unusual performance substantiates the claim that manufacturing industry has acquired a new dimension in these last two years. Other indicators and informed observations also bear out this view.

In probing the reasons for this growth it will be necessary to examine in particular changes in external factors since 1959, because it is true to say that the demand in Hong Kong's principal markets and the commercial policies their respective governments pursue are in the first and last resort what shapes and determines the growth of Hong Kong's manufacturing industry, which in turn exercises a decisive influence on the shape and progress of the remainder of the economy. There are many other important factors -tourism, service industries, invisible earnings from the very