ENG-1972 — Page 33

INDUSTRY AND TRADE

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developed countries, but also at avoiding disruptive conditions in import markets. Under the CTA, Hong Kong has entered into a number of agreements with govern- ments of developed countries, restraining exports of various types of cotton textiles to stipulated levels and under certain conditions.

Also of importance to Hong Kong in varying degrees are the activities of the United Nations Conference on Trade and Development (UNCTAD), the United Nations Economic Commission for Asia and the Far East (ECAFE)-of which Hong Kong is an associate member-the Organisation for Economic Co-operation and Development (OECD), the Asian Productivity Organisation (APO) and the Asian Development Bank (ADB)—Hong Kong is a member of the last two of these in its own right.

All these matters, in both their external and internal aspects, are the concern of the Economic Branch of the Colonial Secretariat in terms of higher policy and of the Commerce and Industry Department at the advisory and executive levels.

On matters of policy affecting trade and industry other than textiles, the Director of Commerce and Industry takes advice from the Trade and Industry Advisory Board of which he is chairman. This is a body of senior unofficial representatives of com- merce, industry, banking, insurance etc, nominated by the Governor, which meets once a month. The Textiles Advisory Board, a more specialised board also chaired by the Director, is consulted on matters affecting the textiles industry. It met on 43 occasions during 1972.

Industry

Light industry predominates in Hong Kong and will continue to do so in the foreseeable future. A considerable variety of high quality goods is now produced. However, rising labour costs, competition from other low-cost countries in Asia, active consumer protection activities in Hong Kong's major overseas markets and additional restraints on Hong Kong's textile trade, have continued to make manufacturers aware of the benefits to be gained from higher productivity and diversification into more sophisticated product lines and new industries. An increased level of foreign invest- ment has brought several of these new product areas and industries to Hong Kong. Local manufacturers are also keenly aware of changing trading conditions and, with the assistance of the several institutional organisations supporting industry, are con- stantly upgrading their production, management and marketing techniques.

Textiles

The textile industry not only dominates Hong Kong's economy, accounting for 50 per cent of its domestic exports and 46 per cent of its industrial labour force, but is also a significant factor in international trade in textiles. This situation is likely to continue for some time despite the fact that the total number of export restraint agree- ments now in force will severely limit the industry's future growth rate.

The spinning mills, operating some 925,200 spindles, are among the most modern in the world. In 1972, production of cotton yarn was 250 million pounds, compared