ENG-2007 — Page 496

Nationalist Government began to face defeat in civil war at the hands of the Communists, Hong Kong received an influx unparalleled in its history. Hundreds of thousands of people mainly from Kwangtung (Guangdong) Province, Shanghai and other commercial centres - entered Hong Kong during 1949 and the spring of 1950. The population has continued to grow, reaching 4 million by 1971, 5 million by 1980, 6 million by 1994, and now nearing 7 million.

After a period of economic stagnation caused by the United Nations' trade embargo on China arising from the Korean War, Hong Kong began to industrialise. No longer could Hong Kong rely solely on its port to provide prosperity for its greatly increased population. The rise of Hong Kong's manufacturing sector began with the setting up of textiles mills. The mills gradually expanded their range of products and, by the 1960s, they included man-made fibres and garments. During this decade textiles and clothing made up about half of domestic exports by value.

Although Hong Kong has become an increasingly service-based economy over the past 20 years, textiles and clothing currently constitute around 40 per cent of domestic exports by value. Jewellery, electronics and telecommunication equipment are also major export items.

Over the years, the manufacturing sector has gradually moved from one concentrating on simple, labour-intensive products to one focusing on sophisticated, high value-added products. Taking advantage of the abundant supply of land and labour in the Pearl River Delta, industrialists have expanded their production bases across the boundary while retaining their headquarters in Hong Kong. This mode of operation has contributed to economic development in the region and facilitated the transformation of Hong Kong into a services centre.

In 1966, the year the Cultural Revolution was launched on the Mainland, tension mounted in Hong Kong. During 1967, this developed into a series of civil disturbances, affecting all aspects of life and temporarily paralysing the economy. But, by the year's end, the disturbances were contained and the community continued its tradition of peaceful progress.

Hong Kong continued to expand its role as an entrepôt, particularly for trade with China. Coupled with tourism, this led to vast improvements in communications, with an increasing number of people entering Mainland China from or through Hong Kong, the natural gateway, each year.

To keep pace with the development, the Government places strong emphasis on improving and expanding infrastructure. As a result, Hong Kong has been transformed into a modern city with efficient road and rail links, and first-class port and airport facilities. New highways have opened up previously remote areas, the railway networks are being expanded, and a new international airport has been in operation at Chek Lap Kok since 1998.

The new towns in the New Territories, which accommodate 46 per cent of Hong Kong's population, have eased the pressure on development of the main urban areas.