ENG-1978 — Page 32

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Industry and Trade

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THE manufacturing industry in general continued to perform well in 1978 and achieved an overall rate of growth slightly higher than that in 1977.

The value of domestic exports in 1978 amounted to $40,711 million - 16 per cent more than in 1977.

The major factors that have given Hong Kong its international reputation as a leading manufacturing and commercial centre are still at work. Among these are the consistent economic policies of free enterprise and free trade, an industrious work- force, a sophisticated commercial infrastructure, a modern and efficient seaport that includes one of the world's largest container terminals, a centrally-located airport containing Asia's only computerised cargo terminal, and excellent world-wide.com- munications. There are no import tariffs and revenue duties are levied only on tobacco, alcoholic liquors, methyl alcohol and some hydrocarbon oils. Tax also is payable on first registration of motor vehicles.

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Apart from providing the infrastructure - either through direct services or by co- operation with public utility companies and autonomous bodies the government's principal role in the economy is to ensure a stable framework in which commerce and industry can function efficiently and effectively with minimum interference. The government normally intervenes only in response to the pressure of economic and social needs, and neither protects nor subsidises manufactures.

The Advisory Committee on Diversification, which was appointed by the Governor in late 1977, continued its work in 1978. The committee is to advise whether the process of diversification of the economy, with particular reference to the manufactur- ing sector, could be facilitated by the modification of existing policies or the introduc- tion of new policies. Its chairman is the Financial Secretary, and it includes 13 prominent representatives of industry, banking and business circles and two govern- ment officials. It is expected that the committee will conclude its work in 1979.

Industrial Development and Industrial Land

Light manufacturing industries, producing mainly consumer goods, predominate in Hong Kong. About 68 per cent of the total industrial work-force is employed in the textiles, clothing, electronics, plastic products, toys, and watches and clocks in- dustries. These industries accounted for about 73 per cent of Hong Kong's total domestic exports and are likely to continue to predominate, despite the development of more high-technology industries.