ENG-1985 — Page 79

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問仁

Industry and Trade

FACED with a slowdown in the economic recovery of many of its major export markets, in particular the United States, Hong Kong's trade performance in 1985 was characterised by a fall in domestic exports, a larger increase in re-exports and a slowing down in the growth. rate of visible trade. The value of domestic exports during the year amounted to $129,882 million, compared with $137,936 million in 1984.

Overall, the major factors that have given Hong Kong its international reputation as a leading manufacturing and commercial centre continued to work well. Among these are the consistent economic policies of free enterprise and free trade, low salaries and profits tax rates, an industrious workforce, a sophisticated commercial and industrial infrastructure, a modern and efficient seaport, in which is located the world's third busiest container port, a centrally located airport with a computerised cargo terminal, and excellent world- wide communications.

There are no import tariffs; and revenue duties are levied only on tobacco, alcoholic liquors, methyl alcohol, hydrocarbon oils, cosmetics and non-alcoholic beverages.

A levy is also payable on first registration of motor vehicles, except franchised buses.

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Apart from ensuring the provision of the necessary infrastructure, either through direct services or by co-operation with privately owned public utility companies and autonomous bodies, the government's principal role in the economy is to provide 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. It neither protects nor subsidises manufacturers.

The manufacturing sector is the mainstay of the Hong Kong economy, accounting for some 25 per cent of the gross domestic product and 36 per cent of total employment. It is estimated that up to 90 per cent of Hong Kong's manufacturing output is eventually exported. Light manufacturing industry, producing mainly consumer goods, predominates. About 67 per cent of the total industrial workforce is employed in the textiles, clothing, electronics, plastic products, toys, and watches and clocks industries. These industries together accounted for 78 per cent of Hong Kong's total domestic exports in 1985, a pattern which is likely to continue.

However, within industries there have been considerable changes and improvements in the range of products made. Many new and sophisticated product lines have been introduced and many simpler product lines have been abandoned, partly because of competition from lower cost producers within the region and partly in response to pressures to move up-market resulting from the emergence of various forms of protectionism in some of Hong Kong's main markets. There is an increasing emphasis on quality and technical excellence.