ENG-2002 — Page 70

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THE ECONOMY

per cent in 1981 to 15 per cent in 1991 and even more to only 5 per cent in 2001, consequential to an ongoing relocation of the more labour-intensive production processes to the Mainland. Also relevant was the concurrent rapid expansion of the services sector, along with an upsurge in re-export, transhipment and offshore trade, tourism, transport, telecommunications, financial services, and various other professional and business support services. For the construction sector, its contribution to GDP edged lower from 7 per cent in 1981 to 5 per cent in 1991, and stayed at roughly that level afterwards. As for the supply of electricity, gas and water, the corresponding share held relatively stable, at around 2-3 per cent over the past two decades (Chart 2).

Chart 2

Gross Domestic Product by broad economic sector

Secondary production

31.8%

1981

Tertiary production 67.3%

Primary production 0.8%

2001

Secondary production 13.4%

Primary production 0.1%

Tertiary production 86.5%

an

Along with a profound shift in economic structure, the share of the tertiary services sector in GDP has continued to increase, whereas the share of the secondary sector has dwindled further over the past two decades.

The economic reform and open door policy in the Mainland has not only provided enormous production hinterland and market outlet for Hong Kong's manufacturers, but has also created abundant business opportunities for a wide range of service activities. These activities include specifically freight and passenger transport, travel and tourism, telecommunications, banking, insurance, real estate, and professional services such as financial, legal, accounting and consultancy services. In consequence, the Hong Kong economy has become increasingly service-oriented since the 1980s.

Reflecting this, the share of the tertiary services sector (comprising the wholesale, retail and import/export trades, restaurants and hotels; transport, storage and communications; financing, insurance, real estate and business services; community, social and personal services; and ownership of premises) in GDP leaped, from 67 per cent in 1981 to 77 per cent in 1991 and further to 87 per cent in 2001.

The profound change in the economic structure was also borne out by a broadly similar shift in the sectoral composition of employment. Over the past two decades, the share of the services sector in total employment followed a continuous uptrend,