ENG-1969 — Page 38

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HONG KONG MANUFACTURING INDUSTRY IN THE SIXTIES

likely to be of increasing importance in the next decade. It has also embarked on some pioneering work in the field of industrial design.

The Chinese Manufacturers' Association has continued to con- centrate its efforts on its annual end-year exhibition, which although it has increased in size and annual attendance (180,000 square feet and 1.2 million people in 1959, and 610,000 square feet and 2.6 million people in 1969) has changed little in content. The exhibition has in the past brought to the notice of people in Hong Kong many domestic products of whose existence they were ignorant. It now mainly provides an opportunity for a relatively few export-oriented manufacturers to expose and sell some of their wares to the home market, and for a larger number of small manufacturers mostly concerned with the home market to sell their products, principally confectionery, traditional Chinese foodstuffs, stationery, and house- hold goods, in a framework of brilliantly illuminated stands specially erected for the occasion. The exhibition has always been a truly popular event whose manufacturing character has been somewhat over-shadowed by its valuable contribution to entertainment in and around the Christmas season.

GOVERNMENT POLICY IN RELATION TO INDUSTRY

Economic Policy

The Government's economic policy towards manufacturing industry has not changed during the decade. What might be de- scribed as its negative aspects, that is to say, its reluctance to accord special favour to manufacturing industries, is bound up with a liberal commercial policy, which involves a minimum of official intervention or vexatious restrictions, and neither protection nor subsidisation of manufactures. The Government believes that dynamic and, above all, coherent industrial development in Hong Kong's circumstances is dependent on maintaining these elements of commercial policy. The positive elements benefiting industry are low direct taxation (although the standard rate of profits tax was increased from 12 per cent to 15 per cent in 1966); a prudent, by modern standards unorthodox, almost Gladstonian, fiscal policy; a strong financial structure and a liberal foreign exchange policy within the sterling area; mild but firm public administration, gear- ed to rapid but disciplined operation of standardised commercial