ENG-1993 — Page 110

INDUSTRY AND TRADE

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and trade organisations, and government officials. The council is assisted by a network of committees in its work. Productivity, product innovation and quality improvement services are mainly provided by the Industry Department and the Hong Kong Productivity Council. The Industry Department also promotes inward investment in Hong Kong's manufacturing industries and is responsible for monitoring the provision of an efficient infrastructure within which industry can operate successfully.

On the external relations front, Hong Kong joined the Asia-Pacific Economic Co-operation (APEC) and the Pacific Economic Co-operation Council (PECC) in 1991. APEC is an inter-governmental economic forum inaugurated in 1989. Its main objectives are to strengthen the multilateral trading system, to assess prospects for and obstacles to increased trade and investment flows within the Asia-Pacific region and to identify a range of practical common economic interests. PECC is a non-governmental organisation, comprising tripartite membership drawn from academia and business and public sectors, seeking to develop closer co-operation on trade and economic policy issues within the Asia-Pacific region.

Hong Kong's continuing success as a leading manufacturing and commercial centre is due to a simple tax structure and low tax rates, a versatile and industrious workforce, an aggressive and innovative managerial class, efficient transport facilities, a fine harbour, excellent international communications, and the government's firm commitment to free trade and free enterprise.

Faced with increasing competition from low-cost economies in the region, rising labour costs at home, and demand in its major export markets for ever-higher standards of quality, Hong Kong's manufacturers can no longer compete in the territory's major export markets on price and speed of response alone. Manufacturers are moving decisively away from labour-intensive production into the manufacture of high value-added products which can compete on quality. In this respect, the Hong Kong Productivity Council continued to feature in the past year as the government's principal agent in helping the manufacturing sector improve its productivity and move up the value-added ladder. With its expertise in different disciplines, the council offers diversified services, including management consultancies, training programmes and technological support services.

The government, which supports this restructuring, implements a comprehensive programme to develop the territory's existing quality infrastructure and encourage greater use of quality assurance in manufacturing through a Quality Awareness Campaign. In addition, the Hong Kong Quality Assurance Agency has been established to provide third-party assessment of the quality management systems of companies according to the ISO 9000 standards, and to award ISO 9000 certification to companies that meet the necessary standards. These activities have helped enhance the quality of Hong Kong's products and services.

Science and Technology

Science and technology are transforming the way that business is conducted in all areas of economic activity. To ensure that the territory could respond to the rapidly changing technological environment and to underline the vital connection between industry and technology, the former Industry Development Board and the Committee on Science and Technology were replaced by the Industry and Technology Development Council (ITDC) in early 1992.