ENG-1972 — Page 38

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INDUSTRY AND TRADE

exports by value went to three markets-the United States, Britain and the Federal Republic of Germany. The United States, which remained the largest market, took 40 per cent by value, Britain accounted for a further 14 per cent and the Federal Republic of Germany absorbed 10 per cent. Other important markets were Canada, Australia, Japan, Singapore, Netherlands, Sweden and Taiwan.

The entrepôt trade has sustained its role in Hong Kong. Re-exports totalled $4,154 million in value in 1972, an increase of 22 per cent over the previous year. This was 21 per cent of the total combined value of exports of Hong Kong manu- factures and re-exports of imported goods. Japan remained the most important re- export market, followed by Singapore, the United States and Taiwan. The principal commodities re-exported were diamonds, medicinal and pharmaceutical products, watches and clocks, textiles and clothing, machinery, dyeing, tanning and colouring materials, and coffee.

International Economic Relations

As the United Kingdom has acceded to the General Agreement on Tariffs and Trade (GATT) on behalf of Hong Kong, the latter's exports are given 'most-favoured- nation' tariff treatment in the majority of its overseas markets; they are also accorded a degree of protection against discriminatory import restrictions by members of the GATT. Nevertheless, difficulties do occur from time to time, and the Commerce and Industry Department is responsible for such action as is necessary and practicable at official level to resolve them.

The GATT Committee on Trade in Industrial Products drafted guidelines and rules of conduct regarding customs valuation, licensing procedures and consular endorsements, standards, and export subsidies which are now under consideration by participating governments. A Working Party on the Tariff Study prepared a pre- liminary analysis of the post Kennedy Round tariff situation in major developed countries. The Group on Residual Restrictions and the Joint Working Group ex- amined and considered possibilities of eliminating various residual import restrictions which were still maintained contrary to the provisions of the GATT. The 'Group of Three' formulated proposals to deal with the trade problems of developing countries in the market of developed countries. A Working Party on Trade in Textiles was formed and is expected to complete its fact-finding study and issue a report in early 1973. The Commerce and Industry Department followed and participated in some of these deliberations, which were of considerable interest to Hong Kong, and was kept fully informed by its Assistant Director in Geneva.

The year saw the introduction of a generalised preference scheme for develop- ing countries by the United Kingdom, Ireland, New Zealand, Sweden, Finland and Denmark on January 1, Switzerland on March 1 and Austria on April 1. Finland and Denmark limited their schemes to the UNCTAD 'Group of 77' developing countries, thereby excluding Hong Kong but promised to consider their possible wider extension at a later stage. Hong Kong was included in all the other schemes, but in the case of Austria and Japan, an exclusion list of products was applied solely to Hong Kong.