ENG-1996 — Page 137

7 TRADE AND INDUSTRY

DURING 1996, Hong Kong's economy continued to restructure from a low cost assembly type manufacturing entity towards a regional service and commercial centre and a high value-added manufacturing base. The Hong Kong government embarked on a programme to promote service industries and upgrade technological infrastructure.

Hong Kong's external trade experienced a moderate growth in 1996, with total trade increasing by 3.5 per cent over the previous year. In particular, re-exports registered a 6.6 per cent increase, reflecting the continued important role of Hong Kong as an entrepôt. The gross total value of re-exports was $1,186 billion. Imports rose by 3 per cent to $1,536 billion.

Trade and Industrial Policies

Hong Kong's continuing success as a leading commercial and manufacturing centre owes much to a simple tax structure and low tax rates, a versatile and industrious workforce, its excellent infrastructure, and the government's firm commitment to free trade and free enterprise. The government believes its task is to facilitate commerce and industry within the framework of a free market.

The government's industry policies aim to promote industrial development by creating a business-friendly environment and providing support services. The government zones land for general and specialised industrial use, maintains and develops advanced education and training facilities, ensures a modern legislative and regulatory environment, funds facilities to enhance productivity and quality as well as encourage applied research. It also encourages technology transfer through an investment-promotion programme. However, the government neither protects nor

subsidises manufacturers.

Trade and industry policies are kept under review by the Trade and Industry Branch of the Government Secretariat. The Secretary for Trade and Industry is advised on industry matters by the Industry and Technology Development Council (ITDC), and on trade issues by the Trade Advisory Board and the Textiles Advisory Board. Members of these bodies include prominent industrialists and businessmen, representatives of major industrial and trade organisations and relevant government officials.

External Trade

Hong Kong is the world's eighth-largest trading entity in terms of value of merchandise trade; the fourth-largest if all Member States of the European Union are

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