HON
16 JUN 1967
ONG
LIBRARY
ANNUAL
DEPARTMENTAL
REPORTS
KONG
1965-66
KONG
DIRECTOR OF
COMMERCE AND INDUSTRY
HONG KONG
ANNUAL DEPARTMENTAL REPORT
BY THE
DIRECTOR OF COMMERCE AND INDUSTRY
T. D. SORBY, J.P.
FOR THE
FINANCIAL YEAR 1965 - 66
PRINTED AND PUBLISHED BY J. R. LEE, Acting Government PRINTER
AT THE GOVERnment Press, Java ROAD, HONG KONG
EXCHANGE RATES
When dollars are quoted in this Report, they are, unless otherwise stated, Hong Kong dollars. The official rate for conversion to pound sterling is HK$16=£1 (HK$1=1s. 3d.). The official rate for conversion to U.S. dollars is HK$5.714=US$1 (based on £1=US$2.80).
52333-14K-5/67
CONTENTS
Chapter
I. REVIEW OF THE YEAR 1965–66 .
II. OVERSEAS TRADE RELATIONS BRANCH
General
International Institutions
Paragraphs
1 - 74
75 - 76
General Agreement on Tariffs and Trade .
77 - 79
U.N. Economic Commission for Asia and the
Far East
80 - 81
Individual Countries
European Free Trade Area
United Kingdom
Anglo-Irish Free Trade Agreement
Austria
•
European Economic Community France
Federal Republic of Germany
Tanzania
Nigeria
·
Sudan
Rhodesia
•
The Republic of South Africa
·
82
83
84
85
86 - 87
•
88
89 - 90
91
92
93
94
95
96
97
98 99
-
100
101 - 102
·
•
103
The Trade Mission to East Africa and Zambia .
Malaysia and Singapore
U.S.A.
Free Trade Agreement between Australia and
New Zealand.
Australia
New Zealand
iii
Chapter
III. TEXTILES BRANCH
The G.A.T.T. Long Term Arrangement Regarding
International Trade in Cotton Textiles
Export of Cotton Manufactures to Britain
Export of Cotton Manufactures to the U.S.A. Export of Cotton Manufactures to Other Countries
Canada
Federal Republic of Germany
Norway
•
Italy
Benelux
Woollen Knitwear Exports
IV. CERTIFICATION BRANCH
General
•
Standard Certificates of Origin
Commonwealth Preference Certificates.
Comprehensive Certificates of Origin
Certificates of Processing
Paragraphs
•
104 - 106
107 - 111
112
114
115
•
116
117
118
•
119
•
120 - 121
122 124
-
125 128
129 - 134
•
•
135 - 140
141
Miscellaneous Certificates
Changes in Certification Requirements of Various
Territories.
Certification Co-ordination Committee.
Visits
Certification Revenue
V. INDUSTRY INSPECTION BRANCH
142
143 149
-
150 - 151
152
153
General
Staff
•
Inspections
Kowloon Inspection Control
Investigations
Prosecutions
Anti-Corruption Measures
iv
154
155
•
-
156 157
•
158
160
―
159
162
163
•
164
Chapter
VI. INDUSTRIAL DEVELOPMENT BRANCH
Review of Industry
Textile Spinning
Textile Weaving
Paragraphs
. 165 – 166
167 - 168
Textile Finishing
Cotton Knitting
Woollen Knitting
Wearing Apparel
Plastics
Light Metal Products
Electronics
Hair Wigs.
Machinery.
169
•
•
170
•
•
171
172
173
Shipbuilding
Shipbreaking and Steel Rolling Mills
Land for Industry.
•
174
175 - 178
·
•
179 - 180
181
•
182
183 - 184
185 - 186
187
Kwun Tong
188
Tsuen Wan/Kwai Chung District
189
Industrial Land Sales
190
191
Industrial Co-operation
Health and Safety Aspects of Hong Kong Products
General
Drink Coolers
•
Toys-Lead Content.
192 - 193
194
195
•
196
Toys-Safety Hazards
Economic Commission for Asia and the Far East 197 - 198
Commonwealth Standards Conference
Immigration Enquiries
Provisional Productivity Council
+
Asian Productivity Organization .
199 - 200
201
•
❤
202
204
•
205 - 208
V
Chapter
VII. TRADE DEVELOPMENT BRANCH
Overseas Activities
Milan Samples Fair 1965 .
Sixth Tokyo International Trade Fair
East Africa Mission .
International Fire Exhibition and Conference
Exhibit at the Bull Ring Birmingham and
Department Store Displays
Commonwealth Arts Festival
Sydney International Trade Fair
Planning and Preliminary Work for Future
Overseas Activities.
Local Trade Exhibitions
+
•
Paragraphs
209 - 211
212 - 216
+
217 218
219 - 221
222 - 228
229 230
231 236
-
237 - 244
Display Centre of Hong Kong Products
245 -- 248
•
Overseas Trade Missions, Exhibitions, etc.
Floating Rhodesia Tobacco Exhibition Japanese Products Exhibition
249
•
250
•
Japan West Prefectures Products Exhibition
251
Chinese Toys Exhibition
252
Swiss Watch Exhibition
253
Sixth Japan Industry Floating Fair
254
British Week
255 - 257
Trade Missions .
258 - 261
•
Trade Complaints.
262
264
VIII. TRADE PUBLICATIONS BRANCH
Trade Bulletin
265 - 269
vi
Chapter
IX. OVERSEAS OFFICES
London Office
Paragraphs
General and Office Accommodation.
Trade Relations
Trade and Industrial Promotion and Public
Relations
Visitors
Hong Kong House
Sydney Office
General
Trade Enquires, etc.
270 273
274 - 276
277 288
289
290
-
291 – 293
294 - 295
Sydney Trade Fair
Publications and Public Relations
Brussels Office
X. TRADE LICENSING AND Supplies BRANCH
Trade Licensing
•
Supplies
Rice.
Frozen Meat
296
297 - 299
300 - 302
•
. 303 - 310
311
312 - 317
318
319
Coal and Firewood
Corned Beef
•
XI. DUTIABLE COMMODITIES BRANCH
Revenue from Excise Duties.
Tobacco
•
Hydrocarbon Oils
Liquor
Table Waters
Revenue from Licences.
320
321
. 322 - 323
324 - 325
•
326 - 327
328 - 329
·
330
331
vii
Chapter
XII. PREVENTIVE SERVICE
*
General
Paragraphs
. 332 - 334
Organization
Training
Staff and Discipline
Searches
Narcotics
Bullion.
335 - 337
·
•
·
338 - 351
352 - 356
357 - 360
361 364
365 - 366
367
368 - 369
•
Emergency (Agricultural Poisons) Regulations
Court Actions
XIII. STATISTICS BRANCH
General
Trade Statistics
Classification.
Trade Declarations
Parcel Post Statistics..
Consumer Price Index
•
Movements of the Consumer Price Index.
370
. 371
372 376
377
-
378
Retail Price Index.
Work for 1965 Salaries Commission
Continuous Household Expenditure Surveys
Textile Production Statistics.
Research
Publications.
Data Processing
•
Surveys Conducted by the Organizational Surveys
Unit.
viii
379
380 - 383
384 - 385
386 - 387
•
388 - 390
391 - 393
394 - 395
396 - 398
399 - 405
406
Chapter
XIV. ADMINISTRATION AND ACCOUNTS BRANCH
General
Organization and Personnel.
Departmental Organization
Paragraphs
407
408
•
409 - 411
Establishment
•
Recruitment
Training
•
Appointments and Senior Staff Movements
Office Accommodation.
Welfare
Departmental Quarters
Welfare Fund
•
Leave
Revenue Inspectors' Mess.
Clerical Canteen
Sports/Social Club
Accounts and Stores
412 414
415 417
-
418 - 422
423 - 450
―
451 456
457
·
458
•
•
459
·
460 - 462
·
463
•
•
464
465
·
Revenue
Forfeitures
Expenditure
Stores
ix
466
•
467
468
469 - 474
APPENDICES
Appendix
1.
Organization Chart of the Commerce and Industry Department,
as at 31st March, 1966.
2A. Exports of cotton textiles restrained under G.A.T.T. Cotton Textiles Arrangements from October 1961 to September 1966.
2B. Exports of restrained cotton textiles to Britain from 1963 to 1965.
2C. Exports of restrained woollen knitted outerwear to the Federal
Republic of Germany from January 1966.
3. Certification of origin statistics, 1963-64 – 1965-66.
4.
5.
Trade complaints from overseas companies or individuals,
1965-66.
Net revenue collected from all sources, 1964-65 and 1965-66.
6.
Duty from dutiable commodities (gross), 1963-64 – 1965-66.
7.
Revenue from dutiable commodities licences, 1965–66.
8.
Major confiscations under other legislation, 1965–66.
9.
10.
11.
Confiscations under the Dutiable Commodities Ordinance (No. 26 of 1963) and Dangerous Drugs Ordinance, Chapter 134, 1964-65 and 1965-66.
Distribution of approval establishment, as at 31st March, 1965
and at 31st March, 1966.
Trade Missions etc. from Overseas, 1965–66.
X
I. REVIEW OF THE YEAR 1965-66
HONG KONG's trade for the calendar year 1965 is to be the subject of a separate review. It is sufficient here to record that despite an awkward start 1965 ended with a satisfactory 14% increase in the value of domestic exports which totalled $5,028 million, an 11% increase in respect of re-exports valued at $1,502 million and a 5% increase for imports valued at $8,968 million. This brought total trade to a record value of $15,495 million, an 8% increase over 1964. These results were obtained in the face of difficulties both domestically and in our overseas markets. They reflect great credit on the resilience and enterprise of industry and com-
merce.
2. The financial year under review has been a particularly busy one for the department generally and for both the Trade and Industry Advisory Board and the Cotton Advisory Board on which I rely for advice. Our main concerns have been to keep the channels of overseas trade clear of new and more onerous restrictions; to establish new institutions to assist in the promotion of overseas trade, to protect exporters developing new and existing markets, and to increase industrial productivity; and to adjust the organization and staffing of the department to new and more complex responsibilities. This work has had to be done without any break in traditional responsibilities which have expanded in keeping with the growth of trade, population and development.
EXTERNAL COMMERCIAL POLICY
3. My comments in this section are far from comprehensive, but they illustrate activity in the field of external commercial policy, the increasing need for departmental staff to travel abroad, the part that the department's overseas staff plays, the very valuable assistance given by British diplomatic representatives abroad, and the necessity to train specialized staff in Hong Kong coupled with a build up of a departmental organization to meet the ever-increasing need to keep clear the channels of trade in Hong Kong's manufactured products. This is trade promotion in the broadest sense, in a sector where Government alone can and must accept responsibility. This is well understood by the department's advisory boards which are constantly consulted on the often delicate issues involved.
1
United Kingdom
4. The Board of Trade's announcement in October that the 'carryover' of unshipped 1965 quota yardage into 1966 would not be permitted came as a shock, 52% only of the quota, in terms of fabric yardage, having been shipped by the end of September. It had always been assumed in Hong Kong that the agreement with Britain in respect of cotton textile exports provided for 'carryover' in respect of each of its three years, including the last, if restrictions were to be continued. Despite the personal intervention of His Excellency the Governor with the President of the Board of Trade it was not possible to reverse the policy decision of Her Majesty's Government in so far as it affected Hong Kong. However special arrangements concerted with the advice of the Cotton Advisory Board enabled Hong Kong to ship by the end of 1965 its full quota in terms of fabric yardage, if not in the economically more valuable form of garments.
5. The Board of Trade's proposals for the control of all cotton imports from countries regarded as 'low cost suppliers' for a period of five years from 1966-70 proved so controversial internationally that their introduction had to be delayed while amendments were referred to the Cotton Textile Committee of the G.A.T.T. Negotiations on the application of the proposals in respect of Hong Kong, conducted in constant consultation with the Cotton Advisory Board, were held here in February. They resulted in satisfactory interim arrangements in accordance with which Hong Kong was enabled to retain export controls in a manner which fitted in with arrangements ultimately sanctioned · for all countries, including Hong Kong.
United States
6. As from 1st October, 1965, exports of cotton textiles to the United States continued on the basis of provisional arrangements negotiated under Article 3 of the G.A.T.T. Long Term Textile Arrangement. In February 1966 the United States Government presented proposals for a comprehensive bilateral agreement for five years retrospective to 1st October, 1965. In March, on the advice of the Cotton Advisory Board, a Deputy Director, and an Assistant Director, held exploratory talks in Washington, which subsequently led to negotiations in Hong Kong for a bilateral agreement.
7. Other discussions in Washington brought to an end protracted negotiations under Article XXVIII(2) of the G.A.T.T. stemming from
2
•
rationalization of the U.S. customs tariff, the residual effect of which was some damage to exports from Hong Kong. The United States Government agreed compensatory adjustment to the tariffs on certain items of rattan ware and carved ivory, which could be of benefit to Hong Kong.
8. A source of long-standing dispute with the Unites States, i.e. American selling price valuation for customs purposes of imports of protective footwear of natural rubber of which Hong Kong was a major supplier, was resolved during the year by substitution of revised 'most favoured nation' tariff rates.
Federal Republic of Germany
9. Negotiations in connexion with Hong Kong's exports of knitted woollen outerwear to the Federal Republic were conducted in Bonn in October and in January. No agreement having been reached in the first negotiation, it was necessary to suspend exports of the goods in question during the last six weeks of 1965, unless covered by export authorizations. The second negotiation concluded with agreement on export restraint for a period of two years at a level which permitted substantial growth of the trade. In both negotiations, the Trade and Industry Advisory Board played a major consultative role.
France
10. A Deputy Director and the Assistant Director, Brussles Office, represented Hong Kong at discussions in Paris on import restrictions imposed by the French Government on imports from Hong Kong. The French Government agreed to remove restriction on some items and to introduce increased quotas for some other imports on the restrictive list.
Benelux
11. Mr. HOLMES, then Director, personally visited the Hague in July in connexion with the Benelux request for restraint on the export of certain cotton garments. Negotiations continued intermittently and had still not been completed by the end of March 1966. An attempt to extend this request to include shirts of synthetic materials was rejected.
Italy
12. Import restrictions on cotton fabrics introduced early in 1965 by the Italian Government were allowed to lapse at the end of the year,
3
but a request for restraint on exports of cotton bed and table linen was made in January 1966. Negotiations were held in Hong Kong in March, as a result of which the Italian request was withdrawn and the products affected subjected to stricter origin certification requirements instead.
Canada
13. Negotiations were held in Hong Kong in October with a Canadian delegation, as a result of which agreement was reached on exports of cotton textiles to Canada during the fourth year of the Long Term Arrangement. A request for restraint on shirts of synthetic materials was not accepted, as being outside the scope of the Arrangement.
Austria
14. The United Kingdom Government, acting on behalf of the Hong Kong Government, submitted an aide memoire protesting to the Austrian Government against the application of anti-dumping legislation to imports of Hong Kong manufactured woollen knitwear, largely being imported through third countries. Negotiations on this matter were scheduled for the summer of 1966.
Nigeria
15. In August, the Nigerian Government banned all imports from Japan and Hong Kong. Later it relaxed its controls to the extent of requiring imports from Hong Kong to be covered by import licences. In view of the discriminatory nature of this requirement, the Hong Kong Government protested formally to the Government of Nigeria. An Ad- ministrative Officer seconded temporarily to the department and who had served in Nigeria, visited Lagos in November to press for removal of the restrictions. He was able to have discussions, but political con- siderations militated against the success of his mission.
General Agreement on Tariffs and Trade
16. The department followed with considerable interest the progress of the Australian proposals to introduce a limited quota system of tariff preferences for imports from less-developed countries. A Deputy Director attended some of the relevant G.A.T.T. discussions in Geneva.
17. Mr. NORBOM of the G.A.T.T. Secretariat visited Hong Kong in May in connexion with the study of trade in cotton textiles being under- taken by the G.A.T.T. expert group at the Cotton Textiles Committee's
4
request. Departmental representatives later attended a meeting of the expert group in Geneva in October.
18. The department prepared a review of the first three years of operation of the Long Term Arrangement and sent copies to the G.A.T.T. Secretariat in connexion with the major review of the Long Term Ar- rangement due to be undertaken by the Committee in December. In the event the proceedings were monopolized by consideration of the Board of Trade's proposals for an import control on all low cost suppliers of cotton textiles.
19. In July Mr. Wyndham WHITE, Secretary General of G.A.T.T., circulated certain exporting countries participating in the Long Term Arrangement to sound out their reactions to a proposal to link discussions on the tariff reductions to be considered under the Kennedy Round with those for the extension and more liberal application of the Long Term Arrangement. After corresponding with the G.A.T.T. Secretariat, Mr. HOLMES, Director, and Mr. HADDON-CAVE, Deputy Director, attended various meetings in Geneva in September, October and November. In February a statement of Hong Kong's desiderata as an exporting country in connexion with this package proposal was sent to the G.A.T.T. Secretariat.
CERTIFICATION OF ORIGIN
20. In the peculiar circumstances of Hong Kong, certification of origin, and more particularly of Hong Kong origin, is of vital importance to the promotion of domestic exports and an important factor in external commercial policy. It necessitates a degree of control probably unknown in most other countries, not always welcome to exporters and manufac- turers, but nonetheless by and large appreciated as a necessity and in its own way an adjunct to trade and fair trading practices. During the year under review, the Deputy Director in charge of administration and the Trade and Industry Advisory Board also were, for instance, much concerned with relating information derived from certification of origin procedures to export promotion in the field of trade enquiries and to industrial development. At the same time, the only industrial production statistical series which were of any validity stemmed directly from certi- fication of origin of textile products.
21. The Certification Branch issued over 400,000 certificates of origin of all kinds during the year, representing 60% of the value of total domes- tic exports. No certificate is issued unless the application by an exporter is
5
legally associated with the name of a factory, of whom 5,700 were regis- tered at the end of the year. Some two hundred officers are engaged in the work of the Certification Branch. Revenue from certification fees continued to make the service self-supporting.
Certification Co-ordination Committee
22. An administrative committee maintained co-ordination between the department and the three Government approved certification authori- ties, namely the Hong Kong General Chamber of Commerce, the Federa- tion of Hong Kong Industries, and the Indian Chamber of Commerce. At the end of the year, a number of proposals were under consideration intended to provide greater protection against malpractice for non- Government certificates of origin.
Industry Inspection Branch
23. The Industry Inspection Branch provides the necessary inspection and investigation support for the Certification Branch, and is therefore an important and integral part of the certification system. During the year this branch was completely reorganized and a new grade of specialist officer (in lieu of the less specialized Preventive Service staff hitherto employed) authorized to provide it with staff attuned to modern circum- stances, inter-changeable in due course with staff of the Certification and Industrial Development Branches. By the end of the year, recruitment of nearly eighty officers was under way and a number of appointments had already been made.
24. Alongside these organizational changes, the work of policing the departmental certification system continued and many thousands of physical inspections of registered factories and consignments of goods for export were undertaken. This workload created serious problems for the temporarily reduced staff available who also had to contend with many detailed investigations and over 120 prosecutions.
25. The department made strenuous efforts to teach factory managers and staff that the offer of bribes and 'tea-money' was both illegal and unnecessary. Notwithstanding these efforts, it was necessary to warn fifteen people for making such offers to inspection staff. Two persons were prosecuted and sentenced to imprisonment for serious offences of this nature.
6
MII
EXPORT PROMOTION
26. Export Promotion in its most direct sense has for many years been a major function of the department, more particularly the work of a branch concerned with mounting trade fairs, trade missions, etc., and a branch specializing in printed publicity. In 1964-65, plans to concert the efforts of all branches of the department resulted in an export promo- tion programme of unparalleled magnitude in the year under review. At the same time, the Assistant Director in charge of the Export Promo- tion Division was engaged in complex organizational planning for two new extra-Governmental institutions. The first entailed surrender by the department of its direct export promotional activities to a new autonomous statutory organization; the second concerned the ground work for an autonomous statutory export credit insurance organization, already approved in principle.
Working Committee on Export Promotion Organization
27. As a result of the report of the Commercial Public Relations Co-ordinating Committee under the Chairmanship of the Director, the Governor appointed a Working Committee in March 1965 to examine suggestions for a central export promotion organization. The new Com- mittee included representatives of the Trade and Industry Advisory Board, Hong Kong General Chamber of Commerce, the Federation of Hong Kong Industries, the Chinese Manufacturers' Association and the Tourist Association as well as four officials. It held its first meeting under Mr. HOLMES' chairmanship on 1st April, the first of twenty-one meetings during the ensuing nine months, which led to the Committee finalizing its conclusions and signing its report on 24th December. The Committee's report was accepted by Government in February.
28. The report recommended that a central organization should be established; that it should consist of a 15-member policy making council under an unofficial chairman, with representatives of commerce, industry and Government; and that it should be charged with assisting in the development of Hong Kong's external trade by promoting its exports and creating a favourable image of Hong Kong as a trading partner and manufacturing centre. The council would be responsible for preparing programmes and budget, engaging staff and authorizing expenditure. It would have an Executive Director, having wide authority by delegation and the services of permanent staff, the nucleus of which would be the
7
existing staff of the Export Promotion Division of the Commerce and Industry Department and of the Public Relations Joint Committee of the Hong Kong General Chamber of Commerce and the Federation of Hong Kong Industries. The Executive Director would be responsible to the Council for the implementation of its policy, including the organization and execution of trade promotion projects and the establishment of overseas representation. The Committee recommended that the council should be supported by subvention from public funds, which should be equivalent in the first year of its existence to 0.25% of the value of domestic exports or some $11.5 million on 1964-65 figures. These funds should be derived both from the general revenue (HK$5 million) and from special taxation, which the Committee suggested should be by a levy on the commercial and industrial community (HK$6.5 million).
29. There was some division of opinion over the degree of financial control to be exercised by the Government, but in the end agreement was reached on all but a few points. Considerable discussion on the title for the proposed council resulted in choosing the title 'Hong Kong Trade Development Council' (FHYSÄRA).
30. In its final chapter, the report referred to proposals by the Com- mittee for transitional arrangements whereby the inevitable delay in incorporating the council should not prevent an expanded programme of activities being undertaken or the establishment of the secretariat of the council-to-be. On 1st October, Mr. R. G. L. OLIPHANT, former Deputy Chief Manager of the Hongkong and Shanghai Banking Corpo- ration, was appointed Executive Director designate. Proposals had been made by the department in the summer to re-site the Export Promo- tion Division and the Display Centre together in the Ocean Terminal, and these plans were modified to accommodate the full secretariat of the proposed council. The premises were occupied at the end of March with a view to commencing operations as the Trade Development Office at the beginning of the new financial year. Detailed discussions in the first months of 1966 resulted in satisfactory provisional arrangements for finance and for the inclusion within the Office's control of the offices in New York, Brussels and East Africa formerly operating under the aus- pices of the Public Relations Joint Committee, and of the Sydney Office and part of the London Office (including the Display Centre) of the department.
31. Mr. OLIPHANT went to Europe in December to study the central promotion organizations in a number of countries with similar experience
8
or problems to Hong Kong. He paid visits to the British National Export Council, the Austrian Federal Chamber of Economy, the Swiss Office for the Development of Trade, and the G.A.T.T. International Trade Centre. He was accompanied by the Senior Trade Officer of the Export Promotion Division who also visited the Irish Export Board and the Italian Institute for Foreign Trade. Much useful information was obtained through these visits.
Departmental Trade Promotion
32. Meanwhile the department's own export promotion efforts, planned largely in the previous year, took effect.
33. East African Mission. A trade mission to East Africa under the leadership of the Hon. P. Y. TANG left the Colony on 11th June and was away for just over a month. The mission arrived at a fortunate time and considerable interest was shown in trade with Hong Kong. A quick follow-up included the appointment of a trade representative, Mr. G. J. CONNINGTON, by the Joint Public Relations Committee and the sub- sequent despatch of a selling mission.
34. Trade Fairs. The department, on the advice of the Trade and Industry Advisory Board, participated in three trade fairs during the year; in Milan, Tokyo and Sydney. Details are given in Chapter VII. Dr. S. Y. CHUNG led the delegation to the Milan Fair in April, a follow-up on the 1964 participation in the same fair, with a strong bias towards selling domestic manufactures. The decision to take part in the Tokyo Inter- national Trade Fair, also in April, involved breaking new ground, i.e. an attempt to sell in the home territory of a direct competitor, but in a setting which also attracted buyers who also visited Hong Kong. The Honourable FUNG Ping-fan led the Hong Kong delegation. Participa- tion in the Sydney International Trade Fair was a co-operative effort by the department, the Hong Kong General Chamber of Commerce and the Hong Kong Tourist Association. Most of the detailed work was under- taken by the Sydney Office.
35. Trade Promotion in Britain. The exhibit of a wide range of Hong Kong products in the new Bull Ring shopping centre in Birmingham in July was an interesting new venture which proved worthwhile and less expensive than a normal trade fair. This exhibit was followed by displays in branches of Lewis' department store in Leeds, Manchester, Glasgow and Bristol and in Selfridges in Ilford. The advantage of this type of display as a means of influencing the buying public was the sale in the
9
stores concerned of the goods on special display. Combined with a carefully prepared publicity campaign these displays did much to intro- duce the public in Britain to the improved quality and variety of goods made in Hong Kong.
Export Credit Insurance
36. Practical arrangements were made to set up an autonomous Export Credit Insurance Corporation in accordance with the recommenda- tions of Mr. R. A. FREEMAN which were embodied in a report approved by the Governor in Council and later by the Finance Committee in May. Mr. K. D. ROBERTSON of the Hongkong and Shanghai Banking Cor- poration was seconded to the department on 1st November to be Com- missioner designate. From November to January he studied the principles and methods adopted by the Export Credit Guarantees Department in London. Draft legislation was prepared by the Legal Department. A Senior Trade Officer, was seconded to the embryo organization in the autumn as Administrator, responsible for recruiting a skeleton staff and arranging accommodation. Discussions with the Financial Secretary took place after Mr. ROBERTSON's arrival in February to settle details of the financial arrangements and the legislation required before the Corporation could be formally established. Recruitment of an experienced technically- qualified manager was well in train at the end of the year in co-operation with the London Office of the department.
Provisional Productivity Council
INDUSTRY
37. During the year, a Provisional Productivity Council was appointed by His Excellency the Governor following acceptance of the principal recommendations in a report on industrial productivity by a Working Party. The Council met several times during the year to consider and implement a programme designed to accelerate productivity training and consciousness in Hong Kong. By the end of the year, legislation to es- tablish the Council as an autonomous organization was well advanced and the nucleus of a Productivity Centre was already in operation. Mr. A. C. SLATER, Trade Officer, was seconded to the Productivity Centre with a small staff and a recruitment programme was under way to obtain an Executive Director and other senior staff for the Centre.
38. A number of industrial managers were sent on study courses organized by the Asian Productivity Organization and several seminars on
10
productivity were held in Hong Kong under the auspices of the Hong Kong Management Association.
Health and Safety Standards
39. Much work was done during the year on health and safety factors affecting Hong Kong products. Overseas complaints, particularly in Britain, gave rise to much adverse publicity, principally in respect of toys. The department investigated these complaints and, where necessary, took action to improve any product found to contain faults in design or materials. As a result of an investigation involving plastic drink coolers, the department took steps to restrict their export until an accept- able code of manufacture could be worked out with the medical authori- ties to ensure that they did not represent a risk to health.
40. The toy industry was kept informed of overseas health and safety standards and exhorted to work to them. Towards the end of the year, the department introduced a sampling and testing system under which paints used in toy factories were tested by the Government Chemist to ensure that the lead content was within acceptable standards. By the end of the year consideration was being given to extending the scope of this system.
Industrial Land
41. The department continued to assist industrialists and other Government departments to resolve problems arising from the purchase or development of industrial land. The reduction of credit facilities granted by banks gave rise to considerable difficulties for some developers and there was a marked reduction in industrial land sales during the year. Some industrial lots had to be re-entered by Government as a result of the failure of developers to meet their instalment payments. To assist land developers generally, Government agreed in November to extend by one year the time within which building covenants had to be fulfilled. This concession gave developers more time to organize the necessary capital for building.
Industrial Development
42. Work continued usually in co-ordination with the main industrial and commercial organizations, on general matters connected with indus- trial development. They included consideration of the need for industrial standards, for the study of industrial design, the training of industrial
11
workers and many other matters. The department was represented on several committees studying industrial issues.
CONTROLS
The Rice Trade Dispute
43. In the first quarter of the year, a widely publicized and potentially disruptive dispute arose between rice importers and the Rice Merchants (Wholesalers) Association on the one hand, and rice retailers on the other. It was started by an attempt by two retailers associations to deal direct with importers, thus cutting out the wholesalers. The reasons given for this move were an increase in wholesalers' commission during the previous year, from 30 cents a picul to $1.50 a picul, and the restrictive nature of an internal quota system adopted by the wholesalers' association some months previously. In the view of the retailers associations, these arrange- ments eliminated the free competition which had previously existed amongst wholesalers for retailers' business, and which took the form of cash rebates. The retailers argued that, by eliminating 'middlemen' through direct purchases from importers, they would be able to market rice more efficiently and cheaply.
44. It became apparent that the three main parties to the dispute were unable to reach an amicable settlement between themselves, and the department therefore intervened on 20th April. The crux of the matter was the credit arrangements on which the stability of the rice market depended, and it was considered essential that these should not be dis- rupted by any final settlement made. So that the public could be better informed on the rice trade, the department issued a detailed 'Fact Sheet' and a statement explaining the issues involved. After negotiations lasting for over one month, the wholesalers agreed to abandon the quota system imposed in the previous quarter, and to reduce their gross mark-up to 80 cents a picul. Both importers and wholesalers also agreed that importers should sell direct to any retailer on condition that the retailer concerned should first liquidate any debts owing to the wholesalers. A mutually satisfactory system of ensuring that debts were cleared before direct issues commenced was evolved by the department with the co-operation of all concerned. The two retailers associations, and fifteen individual retailers were buying direct from the importers by the end of the year.
45. Rice prices began to rise in July owing to a combination of a shortfall in the Thai harvest, and heavy regional demands arising from the failure of crops in India and Pakistan, the war in Vietnam, and dis-
12
turbed conditions in Indonesia; the trend continued until the end of the year.
Narcotics
46. The drive against narcotics smuggling was continued during the year, 74 seizures being made. With the many other calls on their staff the Preventive Service continued to maintain the vigilance necessary to achieve success. The skill of the special section concerned with this work continued to improve. Co-operation was maintained with the Narcotics Bureau of the Hong Kong Police.
Strategic Controls
47. The Importation (Prohibition) (Strategic Commodities) Regula- tions 1959 and the Exportation (Prohibition) (Strategic Commodities) Regulations 1959 were revoked, and replaced by the Importation and Exportation (Strategic Commodities) Regulations 1965, on 21st December. The object of these new regulations was to revise the list of strategic commodities which can only be imported or exported under licence, so as to bring it into line with the list now in force in Britain. Following the British Government's policy, controls were also introduced to cover exports of arms and military equipment to India, Pakistan and Southern Rhodesia during the year. Controls continued to be exercised on strategic goods intended for export to Indonesia.
Sanctions against Southern Rhodesia
48. Following the Unilateral Declaration of Independence by the Southern Rhodesian Government on 11th November, and in line with action taken by the British Government, Hong Kong imposed an embargo on the export of arms and military equipment to Rhodesia on the 18th November. Hong Kong's trade with the Rhodesian Federation (separate figures are not available for Southern Rhodesia) in the year preceding U.D.I. (i.e. 1964) had amounted to approximately HK$25 million, of which approximately $15 million represented imports from the Federation.
49. Approximately one-third of Hong Kong's total manufacturing consumption of tobacco over the past few years had been imported from Southern Rhodesia. Under the Importation (Southern Rhodesian To- bacco) Regulations promulgated on 17th December, the Hong Kong Government imposed a ban on imports of tobacco from that country. In 1965, total imports from Southern Rhodesia amounted to HK$13.2
13
million of which tobacco accounted for HK$12.6 million; total exports to the same country amounted to HK$7.2 million of which HK$3.7 million was represented by yarns, fabrics and clothing mainly of cotton.
50. In the event, most Hong Kong tobacco importers imported the larger part of their outstanding commitments with Rhodesia prior to the imposition of the ban. Alternative sources of supply were readily available from the United States, Thailand, China and elsewhere, although at possibly higher prices. It is normal in Hong Kong for tobacco manu- facturers to keep approximately ten months' stock of tobacco either in bond or in their own warehouses.
Dutiable Commodities:
MISCELLANEOUS
Revenue out-turn
51. Net revenue from dutiable commodities registered an overall increase of $4.20 million. Duties on hydrocarbon oils and liquor continued to increase, whilst a drop in revenue was recorded for tobacco and table waters.
1965-66
$
1964-65
Percentage Change
$
Tobacco
93,684,000
101,184,000
7.4%
Hydrocarbon oils... Liquor
82,391,000
77,059,000
75,816,000 + 8.7% 71,843,000 + 7.3%
Table Waters
6,245,000
6,328,000
1.3%
Total
259,379,000
255,171,000
+ 1.6%
Revenue from dutiable commodities amounts to about one-sixth of total general revenue.
52. Net revenue from tobacco decreased by 7.4% to $93.7 million, as compared with 1964-65. The main contributory factors were:
(a) A substantial carry-over of duty-paid tobacco leaf withdrawn from bond prior to the 1965 Budget was manufactured into cigarettes for export on drawback to Sabah, and adversely affected net collections in the first few months of 1965–66;
(b) The credit difficulties which prevailed throughout 1965 affected the replenishment of duty-paid tobacco leaf and cigarette stocks held by the manufacturers/importers;
(c) There were increased exports of locally-manufactured cigarettes to Sabah during the second half of 1965. Such tobacco exports on
14
drawback of duty, without a compensating increase in duty-paid releases of tobacco leaf to replenish the manufacturers' stocks, seriously disrupted the pattern of net collections from this source; and
(d) The Public Revenue Protection (Restriction of Delivery of Tobacco) Order promulgated on 25th January, 1966 forestalled pre-budget speculative withdrawals of tobacco from bond.
53. Increased industrial/commercial activities and the greater number of road vehicles continued to push up the consumption of hydrocarbon oils.
54. Consumption of all types of European-type liquor continued to increase, though at a reduced rate as compared with 1964–65. For beer, the increase in revenue was greater than the increase in quantity, and this points to expanded imports from non-Commonwealth sources, particularly China. Imported Chinese-type spirits made further inroads into Hong Kong's domestic market at the expense of their locally- manufactured counterparts. Increased production of molasses spirits by local distilleries resulted in decreased imports of high-strength potable alcohol from South Africa for dilution as non-European-type spirits, thus leading to a drop in revenue from 'spirituous liquor other than intoxicating liquor'.
55. The particularly mild summer affected to a certain extent the consumption of table waters. Consequently, duties from this source were slightly lower than 1964-65.
Significant Seizures
56. A decline in seizures of Chinese prepared tobacco indicated that this trade has now passed through the difficult period of the past few years and the adjustment to the import duties on Chinese prepared tobacco introduced in 1963-64 had cut profits for the smuggler and stabilized the illegal trade. It can be considered therefore that the import duty adjustment has achieved the desired effect. A considerable increase is recorded in the effectiveness of controlling mis-use of industrial diesel oil in road vehicles. From a comparable number of vehicles inspected this year as against last year, five times the amount of diesel oil was seized with two-thirds more arrests. This was due in large measure to improved testing agents supplied by the Government Chemist to Pre- ventive Service patrols.
15
Consumer Price Index and Retail Price Index
57. Movements in the retail prices of goods and services usually purchased by households in Hong Kong have been measured and kept under review by the monthly calculation of three price indices and by a series of small but continuous monthly household expenditure sample surveys.
58. The system of price collection provides prices which are compared with those of the base period to give percentage price movements to be combined to form:
(a) the Consumer Price Index whose weighting system is based on the expenditure pattern of those households in the 1963-64 Survey who spent between $100 and $1,999 monthly;
(b) the Modified Consumer Price Index based on the same survey but on the expenditure pattern of only those households spending between $100 and $600 monthly; and
(c) the Retail Price Index whose weights are based on a survey carried
out in 1947.
59. The monthly sample surveys of household expenditure which were started in July provide a check on the adequacy, in relation to the current period, of the expenditure patterns used as the bases of the Consumer Price indices.
60. The general average trend of prices has been a very slow rise during the year.
Industrial Production Statistics
61. Quarterly textile production statistics continued to be collected from cotton and wool spinning mills, cotton and silk/rayon weaving mills and carpet weaving and tufting mills registered with the department.
62. In March 1966 the Trade and Industry Advisory Board formed a sub-committee under the Chairmanship of Dr. S. Y. CHUNG to advise on what industrial production statistics were needed in Hong Kong and how they should be collected.
Food Unit Exercise
63. The Food Unit of the Essential Services Corps held its first exercise on Sunday, 27th February. The task of the Food Unit is to ensure the maintenance of food supplies to the general public, the Police
16
Force, the Fire Services and the Auxiliary Services under emergency conditions in which it is necessary to impose a curfew. The purpose of the exercise was to put the overall Food Unit plan and organization to the test to see whether it was workable. The supply of rice from the godowns to retail shops was simulated by the Transport Supply Unit, using 211 lorries provided by the various suppliers designated in the plan, and the Canteen Sub-Unit served cooked food to the 1,800 members of the Food Unit and its sub-units who attended the exercise.
64. The overall organization of the Food Unit is the responsibility of the department, and in particular, of the Preventive Service, which took over the task in June. The establishment of the unit is 487 of which about three-quarters are members of the Preventive Service. The exercise proved to be extremely valuable and a post-facto assessment of the results indicated the general soundness of the plans made.
Overseas Offices
ADMINISTRATION
65. Mr. P. C. M. SEDGWICK, C.M.G., took over the London Office after the resignation of Mr. B. I. BARLOW on 1st November. Much of the time of this office had been taken up with the reorganization resulting from the acquisition of additional adjoining premises at 55/58 Pall Mall.
66. The Brussels Office was established during the year in the same building as the British Embassy. In November the Assistant Director, Mr. J. H. MARTIN, was joined by a Trade Officer, Mr. R. PORTER.
67. The Sydney Office continued to act as a Government office during the year but after January arrangements were in hand for handing over the office to the new Trade Development organization. Mr. W. E. MANSON visited the Colony in January for discussions with Mr. OLIPHANT as well as for renewal of contacts.
Recruitment
68. The Accounts and Administration Branch carried out 20 recruit- ment exercises and a total of 145 officers were recruited. The major recruitment programme was for Assistant Trade Officers and the reorgan- ized Industry Inspection Branch.
Training
69. The first departmental training course for Assistant Trade Officers was run on a part-time basis over a period of some ten weeks from
17
January to March. Although a limited success in itself the course did give the department some experience in the vital task of training its own professional grade.
Staffing
70. There were many important changes in the staff of the department. Details are given in Chapter XIV. After November the Directorate of the department was brought up to full strength for the first time since the new organization was agreed in 1964. Considerable thought is still being given to the allocation of responsibilities to the senior staff and more changes are likely to be undertaken before the department can be said to have consolidated its organization.
Progress of Reorganization of the Preventive Service
71. The reorganization of the command structure authorized by Finance Committee in 1964-65 gave rise to additional needs, particularly in training, during the year. Training in administrative and management techniques was given to senior and middle ranks of the inspectorate by means of courses at the Extra-Mural Department of the Hong Kong University, lectures at the Management Association, and overseas courses in Britain and New Zealand. The arrival on 2nd December of a professional adviser on Preventive Service training, a former Com- missioner of Customs and Excise in East Africa, was an indication of the importance which Government attached to the future development and training of the Service.
Trade and Industry Advisory Board
72. The terms of reference of the Trade and Industry Advisory Board are: 'To advise the Director of Commerce and Industry on all matters other than labour matters, which affect the Colony's trade and industry'. In accordance with these broad terms of reference the Board's advice was sought over a wide variety of subjects. In addition, members of the Board played a prominent part in both trade promotion activities and in heading delegations to E.C.A.F.E. I should again like to draw attention to the important contribution made by the Board to the work of the department and of Government.
Cotton Advisory Board
73. A similar tribute is due to the Cotton Advisory Board whose terms of reference are: 'To advise on any matter which directly affects
18
the cotton industry in Hong Kong'. Like the Trade and Industry Advisory Board, all the members are unofficials except for the Chairman, who is the Director of Commerce and Industry ex officio. The Board holds meetings as necessary to advise on the conduct of negotiations and the implementation of agreements. Thirty two meetings were held during the year. In addition, groups of members accompany official delegations to overseas negotiations.
Conclusion
74. Although I am glad to report that the staff situation has improved during the year, this does not mean that the pressure on individuals has been relieved to any significant degree. The constant demands made on the staff by events, both overseas and here in Hong Kong, allow no relaxation. Indeed the department can only maintain its standards of public service through the continued hard work, often well beyond normal official hours, of all its staff in office accommodation much of which is inconvenient and uncomfortable. I am deeply conscious of the devoted service of the staff, both uniformed and civilian, which is recorded in more detail in the succeeding chapters.
II. OVERSEAS TRADE RELATIONS BRANCH
GENERAL
75. The Department continued to develop the Overseas Trade Rela- tions Branch to meet the growing demands of Hong Kong's external commercial activities. This development took the form of improving the expertise of the officers in the Branch and of providing an adequate basic organization from which to work. In addition the reference library was expanded and a cross-reference system introduced to enable material relevant to any particular problem to be quickly accessible.
76. The Branch continued to use working papers and Trade and Industry Advisory Board memoranda as the most suitable means of assessing Hong Kong's best interests in relation to commercial problems. Such papers were prepared on international topics as well as on individual markets. Plans were laid for the results of the latter to be made available to the business community in the form of 'country pamphlets'.
19
INTERNATIONAL INSTITUTIONS
General Agreement on Tariffs and Trade
77. Hong Kong's attention was largely focused on the Contracting Parties' lengthy consideration of the Australian request for a waiver to enable them to introduce their preference scheme for imports from less-developed countries (see paragraph 101 below). An officer of the Department spent some time in Geneva putting Hong Kong's view point on this issue to the United Kingdom Delegation and attending meetings of the Working Party which considered the Australian request. In the meantime, discussion of a global system of preferences for less- developed countries in the G.A.T.T. remained in a state of deadlock, neither the developed nor the less-developed being able to agree on the form the system should take.
78. An officer from the Department was also able to attend the twenty-third Plenary Session of the Contracting Parties as an observer. The most important decision was final agreement to grant the Australian Government the waiver necessary to enable them to introduce their preference scheme. Other matters considered included progress in the Kennedy Round and import restrictions applied contrary to G.A.T.T. and not covered by waivers; in neither case did any developments of immediate interest to Hong Kong emerge.
79. During the year, an Assistant Trade Officer attended a four and a half month in-service training course on commercial policy with the G.A.T.T. Secretariat in Geneva.
U.N. Economic Commission for Asia and the Far East (see also paras.
197 and 198)
80. Mr. Y. H. KAN, J.P. headed the Hong Kong delegation to the Ninth Session of the Committee on Trade, held in Bangkok from 24th January to 2nd February, 1966. He was accompanied by two officers of the Department as alternative delegate and as secretary.
81. The delegation commented that, although Hong Kong's economic circumstances made it difficult for them to contribute effectively to the meeting, the opportunities to publicize Hong Kong, to establish personal contacts and to hear the difficulties, problems and achievements of other countries of the region made continued representation worthwhile.
20
European Free Trade Area
INDIVIDUAL COUNTRIES
82. Under the agreed time-table, a further reduction of 10% was made on 31st December, 1965 in the tariffs on most industrial goods traded between E.F.T.A. Member States. These duties were thus reduced to 20% of the basic level applicable on 1st January, 1960. The effect of this reduction was to increase the competitive position of E.F.T.A. countries vis-à-vis Hong Kong in the United Kingdom for those items for which the United Kingdom preference tariff is higher than zero. Particularly affected were Hong Kong exports of textiles containing man-made fibres.
United Kingdom
83. The United Kingdom Government reduced the temporary import surcharge from 15% to 10% on 27th April, 1965. This reduction did not, however, give rise to a increase of substantial exports of Hong Kong goods to the United Kingdom. Hong Kong domestic exports to the United Kingdom for 1965 totalled HK$861 million compared with HK$968 million in 1964.
Anglo-Irish Free Trade Agreement
+
84. In December, the United Kingdom and the Republic of Ireland signed an agreement to create a free trade area between the two coun- tries. The agreement will come into force on 1st July, 1966. Its provisions include the immediate elimination of the few remaining United Kingdom tariffs on industrial goods from the Irish Republic and a reduction in the Irish tariff on United Kingdom exports of industrial products by 10% a year until duties are eliminated on 1st July, 1975. The local effect of this agreement will be that Hong Kong must now compete with Ireland over a Commonwealth preference tariff of about 30% in the British market for textiles and clothing of man-made fibres.
Austria
85. In an ordinance of 13th July, 1965, the Austrian Government announced that cardigans, pullovers and sets of wool and other animal hair were exposed to the danger of low priced imports. This ordinance enabled the Federal customs authorities to apply the provisions in anti- dumping legislation to imports of these items and to levy anti-dumping duties when prices were lower by more than 20% than average wholesale
21
market prices (less domestic taxes) for similar products manufactured in countries 'with reasonable wage levels' (United Kingdom, Germany, France and Belgium). Austrian importers were consequently reluctant to place new orders and cancelled or postponed existing ones. Exports of woollen knitwear to Austria from June to October 1965 were only half those of the same period of 1964. There was, however, a slight recovery in November. The United Kingdom Government, on behalf of the Hong Kong Government, presented an aide memoire to the Austrian Government protesting against this action.
European Economic Community
86. Extraordinary meetings of the E.E.C. Council of Ministers were held in January, 1966 to discuss ways of solving the deadlock which arose when France withdrew from E.E.C. activities in July, 1965. The crisis had caused a suspension of all but day-to-day activity, but at the extraordinary meetings, the Council of Ministers agreed on several matters to which France had hitherto had objections. These included relations between the E.E.C. Council and the Commission, and the Council's voting procedures.
87. Because of the crisis there had been no further action in connexion with the second stage of Members' alignments of their national tariffs to the E.E.C. common customs tariff, an alignment which could mean tariff increases for certain Community imports from Hong Kong. Also, no further progress could be made on two other issues of interest to Hong Kong, the Community's origin rules and their common com- mercial policy. Nevertheless, the Department has kept a careful watch on developments in respect of these issues and have reviewed them from time to time with the assistance of the Trade and Industry Advisory Board.
France
88. In March, 1966 officers of the Department held talks in Paris with the French Government's Ministry of Economics on the quotas for French imports from Hong Kong subject to discriminatory quantita- tive restrictions. As a result of the talks, the French Government liberalized several items (judo sets, kimonos, brassieres and plastic dolls), increased the quota levels and for the first time allocated quota for all items on the restricted list. They deleted pens and pen nibs and added record players and cameras to the list of items requiring certificates of origin based on a 50% Commonwealth content.
22
Federal Republic of Germany
MARINE DEPARTMENT LIBRA
89. In June, 1965, on the advice of the Trade & Industry Advisory Board, the Government agreed to limit exports of woollen knitwear to the Federal Republic of Germany after two series of discussions in Bonn with the Federal Government. The Department and the Trade & Industry Advisory Board considered that the speed and depth of the penetration of the German market and the value of the trade involved, justified such a deliberate surrender of Hong Kong's G.A.T.T. rights.
90. The level agreed was 875,000 dozens for 1966 and 950,000 dozens for 1967.
Tanzania
91. In July, 1965 the Tanzanian Ministry of Commerce announced that import licences for shirts of a c.i.f. value of less than E.A. Shs. 250/- per dozen would no longer be issued and that licences already issued for shipments of such goods had been cancelled. As a result of representations by the Department, the Tanzanian Government agreed to honour import licences relating to shirts of a c.i.f value of E.A. Shs. 101/- per dozen and above, provided they were valid on 5th August. This led to the recovery of approximately HK$1 million worth of business which would otherwise have been lost.
Nigeria
92. In August, 1965 Nigeria imposed a ban on all imports from Japan and Hong Kong with the exception of textiles which, having been liberalized a few months earlier, were again subject to specific licensing. The ban was imposed as a result of the country's balance of payments position in general and her adverse trade balance with Japan in particular. Formal representations against this action were made to the Nigerian Government, and both the Financial Secretary and the Director of the London Office discussed it with the Nigerian Minister for Finance. The Nigerian Government subsequently modified the restrictions on non-textile items to allow imports under specific licences. In November, 1965 an officer from the Department visited Lagos to press for the removal of these discriminatory restrictions against Hong Kong. He was informed that the Nigerian Government were reviewing the situation and that a satisfactory solution was anticipated for early in 1966. The subsequent coup d'etat in Nigeria affected the outcome of this review and in March the Department was again in correspondence with the United Kingdom High Commission office in Lagos.
23
Sudan
93. In December, the Sudanese Government imposed a total ban on imports from Hong Kong, on the grounds of the serious imbalance of trade between the two territories. The Department arranged for appropriate representation against this action.
Rhodesia
94. Following the Rhodesia Unilateral Declaration of Independence in November, 1965 Hong Kong, in common with many other countries, introduced economic measures against Rhodesia comprising an em- bargo on exports of strategic commodities to that country and a ban on imports of Rhodesian unmanufactured tobacco. A period of grace was allowed to enable tobacco importers to fulfil certain contractual obligations.
The Republic of South Africa
95. Throughout the year the South African Government continued to impose anti-dumping duties on certain imports from Hong Kong based on an arbitrary determination of their current domestic value. Protracted negotiations at an official level resulted in the South African Government undertaking to review the situation.
The Trade Mission to East Africa and Zambia
96. The Branch assumed responsibility for mounting a trade mission to Kenya, Tanzania, Uganda and Zambia in June-July, 1965. Detail of the mission are given in paras. 217-218.
Malaysia and Singapore
97. Following Singapore's secession from Malaysia in August, 1965, both countries have further intensified their import controls for the protection of domestic industries. On the advice of the Trade and Industry Advisory Board an officer from the Department visited these countries in February, 1966 to obtain detailed information on their commercial policies in so far as these are likely to affect Hong Kong.
United States of America
98. Early in October, 1965, the President signed the Tariff Schedules Technical Amendments Act of 1965 which had the effect of abolishing
24
American selling price valuation on protective footwear of natural rubber. The 12.5% duty rate on the tariff item concerned (700.50) was replaced by 12.5% for plastic protective footwear, 25% for overshoes and 37.5% for other protective footwear. Hong Kong's trade in footwear of natural rubber had been affected by competition from Japanese and Korean boots which being of synthetic rubber, did not attract American selling price valuation. Hong Kong should therefore, benefit from the revised
rates.
99. In 1963, the United States Government promulgated a revised tariff classification which resulted in changes in certain duty rates bound under the G.A.T.T., thus entitling Hong Kong to compensation. The Department has been engaged in intermittent negotiations with the United States Government in Geneva and Washington on this issue. An agreement has now been reached on a reduction from 25% to 20% in the American tariff for certain rattan items and from 12% to 8% for carved ivory.
Free Trade Agreement between Australia and New Zealand
100. The signing on 31st August of a Free Trade Agreement between Australia and New Zealand was not unexpected, as talks had been in progress for some time. Both countries have agreed to eliminated tariffs on about 60% of the trade between them. The Department studied the likely effects upon Hong Kong's trade with both countries but concluded these were unlikely to be significant.
Australia
101. On 19th May, 1965, the Australian Government announced their intention to establish preferential tariff quotas for some sixty odd items imported from specified less-developed countries including Hong Kong. Their proposals were put forward as an alternative to full accept- ance by Australia of the new Part IV of the G.A.T.T. committing mem- bers to give a high priority to the reduction of non-tariff barriers to trade and to refrain from increasing tariffs on imports of interest to less-developed countries. A development of some interest to Hong Kong was the addition of nine 'handicraft' products to the list of items proposed for tariff preferences without quotas. Details of all the preference quotas of interest to Hong Kong have been notified to trade and industrial associations.
102. Towards the end of 1965, some changes based upon recom- mendations of the Australian Tariff Board were made in the Australian
25
tariff for woven man-made fabrics, woven cotton fabrics, and bed linen. The Federation of Hong Kong Industries and the Hong Kong General Chamber of Commerce, acting jointly, had earlier in the year opposed any increase in the duties for these items before the Tariff Board. The new rates of duty in general represent an increase for higher priced and a decrease for lower priced cotton fabrics, with the reverse applying to bed sheeting and pillow cases. The new duties on fabrics of man- made fibres tend in general to favour imports slightly more than pre- viously. Full details affecting Hong Kong's exports were made available to the major trade and industrial organizations.
New Zealand
103. The New Zealand import licensing schedule for the year July 1965 to June 1966, was published early in year. Import quotas were in- creased in general by 33% and about 90 additional items were exempted from import licensing requirements. The items in this latter category of interest to Hong Kong included certain medicinal and pharmaceutical products, cotton yarns, sewing threads and a wide range of textile piece- goods. This liberalization was a continuation of the New Zealand Govern- ment's policy to dispense eventually with all import quota controls at a rate which would not unduly upset either developing domestic industries or the balance of payments situation. The liberalized items, or those whose quotas were increased, were generally industrial and agricultural capital goods and raw or processed materials for industrial use. The balance of payments situation, however, was again troubling New Zealand by the end of 1965 and prospects of further liberalization of imports in 1966-67 were diminishing.
III. TEXTILES BRANCH
THE G.A.T.T. LONG TERM ARRANGEMENT REGARDING
INTERNATIONAL TRADE IN COTTON TEXTILES
104. The Long Term Cotton Textiles Arrangement, valid for five years from 1st October, 1962, was designed to develop international trade in cotton textiles among participating countries in an orderly manner. Under the provisions of this arrangement, the Governments of the United States of America, Canada, Norway, the Federal Republic of Germany, the Benelux Countries and Italy have requested Hong Kong to restrain exports to their respective countries in a number of
26
cotton textile categories. The Branch has been responsible for preparing for negotiations on these requests and for the operation of the consequent controls when restraint has been agreed.
105. The agreed export restraint levels together with actual shipment performance for the first four Long Term Arrangement years as well as for the preceding Short Term Arrangement year are shown in Table 2A. For certain garment and made-up categories, the restraint levels have been converted into equivalent square yards to facilitate comparison.
106. The G.A.T.T. Cotton Textiles Committee met in Geneva in early December, 1965 to review the first three years of operation of the Long Term Arrangement and to consider the proposals of the British Government for global controls on imports of cotton textiles from low cost countries. Hong Kong was represented by the Director of Commerce and Industry, who was assisted by the Deputy Director, Trade and Industry and advisers from the textile industry.
EXPORTS OF COTTON MANUFACTURES TO BRITAIN
107. 1965 was the last year of the 1963-65 Cotton Undertaking between the British and Hong Kong Governments. Exports of restrained cotton products to Britain during this period are shown in Table 2B. The unshipped balance of the 1964 and supplementary of quota amounted to about 25 million sq. yds. This quantity was carried over into 1965 and the entire quantity was shipped by the end of June.
108. However exports against the 1965 quota of 195 million square yards were very slow. By the end of September only 52% of the total had been utilized. In the early days of October the Board of Trade announced that it could not agree to a carryover of the 1965 quota into 1966. (See para. 4 above) As a result, the Department, on the advice of the Cotton Advisory Board, introduced special arrangements which enabled Hong Kong to ship its entire quotas by 31st December, 1965. Negotiations with the British Government for arrangements to govern the export of cotton textiles in the period past 1965 were begun in June. However it was not possible to conclude them before 31st December. As a result the Board of Trade agreed that Hong Kong should continue on the basis of 50% of the annual levels under the 1963-65 Cotton Undertaking for the first six months of 1966. These Interim Arrangements for 1966 were announced on 29th November, 1965. A number of products, mainly cotton woven gloves, became subject to restriction for the first
27
time under the interim arrangements and additional yardage was given to Hong Kong for these items.
109. Finally, a team of officials from the Board of Trade visited the Colony in February 1966 for substantive negotiations on the British proposals and provisional agreement was reached on the arrangements to cover Hong Kong's exports of cotton textiles to Britain from 1966 to 1970.
110. At the end of the year under review it had still not been possible to finalise all the details. This was due principally to the fact that it was not possible for Her Majesty's Government to complete negotiations with other exporting countries.
111. Despite the rush to ship at the end of 1965, exports in the first quarter of 1966 proceeded at a favourable rate. By the end of March, 1966, about 50% of the interim quota had been shipped.
EXPORT OF COTTON MANUFACTURES TO
THE UNITED STATES OF AMERICA
112. Due to the buoyancy of the U.S. textile market, the maximum permissible amount for the 3rd Long Term Year ending 30th September, 1965 was fully shipped as opposed to 97% for the 2nd year. The shortfall of 1.4 million sq. yds. shown in attached Table 2A was an induced export shortfall previously agreed with the American authorities, being the last instalment of 'compensation' for goods overshipped in March, 1962.
113. The very strong demand for cotton textiles in the U.S. market continued into the 4th year of the Long Term Arrangement. Although negotiations for arrangements during this year were begun in April, 1965, the trade had to continue on a provisional basis from 1st September to the end of the period under review. By 31st March, 50% of the quota level had been shipped. Shipment performance in unrestrained categories also showed considerable growth. By the end of March, shipments had reached an unprecedented level of 42.3 million sq. yds. compared with 4.3 million sq. yds. during the corresponding period of the previous year. This included shipments in many categories where previously there had been no exports from Hong Kong. In the face of this increase, the U.S. Government had by the end of March requested Hong Kong to suspend the issue of export authorizations in eight of the unrestrained categories.
114. Differences over classification continued to present serious problems, particularly with regard to shipments of cotton duck of mixed
28
combed and carded yarns and of polo necked cotton sweaters. It was not possible to resolve any of these differences by the end of the period under review.
Canada
EXPORT OF COTTON MANUFACTURES TO OTHER COUNTRIES
115. Hong Kong agreed to continue to apply restraints on exports during the fourth Long Term year in respect of seven garment categories (which were subsequently re-grouped to six), the number of fabric categories under restraint being increased to eleven. The restraint levels for the fourth Long Term year totalled 24.9 million square yards, representing an increase of 3.4 million square yards over the previous year.
Federal Republic of Germany
116. The only cotton item subject to restraint during the fourth Long Term year was woven nightwear. The annual restraint level was 400,000 dozens which represented an increase of 5% over the previous year.
Norway
117. In accordance with the terms of a five year bilateral agreement with the Norwegian Government which became effective from October, 1962, exports of cotton woven nightwear and shirts for work, sport and leisure purposes remained under control. The quotas for shirts and nightwear for the fourth Long Term year were 61,000 dozen and 22,000 dozen respectively.
Italy
118. Hong Kong agreed to apply restraint in March, 1965, to exports of five cotton woven fabrics as a group at an annual level of 600 metric tons (or approximately 4.68 million sq. yds.) during the period 16th March to 31st December, 1965. At the end of the calendar year 1965, exports fell far short of this level and the Italian Government agreed to withdraw the restraint with effect from 1st January, 1966.
Benelux
119. In March, 1966 the Benelux Governments requested Hong Kong to restrain exports of cotton woven shirts during the calendar year 1966. Negotiations were continuing on the level at the end of the year under review.
29
WOOLLEN KNITWEAR EXPORTS
120. In January, 1966 Hong Kong agreed to restrain exports to the Federal Republic of Germany of three categories of woollen knitted outerwear during the calendar years 1966 and 1967 at levels of 875,000 dozen and 950,000 dozen respectively.
121. A Wool Committee of the Trade and Industry Advisory Board was formed to advise the Director of Commerce and Industry on the implementation of the agreement, and other matters affecting the wool trade and industry.
IV. CERTIFICATION BRANCH
GENERAL
(see paras. 20-25)
122. The Certification Branch issued 417,372 standard, Common- wealth Preference, and Comprehensive Certificates of Origin, a decrease of 5.7% on last year. The declared value of goods certified was HK$3,251 million representing 63% of the total value of Hong Kong products shipped during the year. The total, when compared with HK$3,057 million for the previous year, showed an increase of 6.3%.
123. The number of separate manufacturing establishments registered with the department for the issue of certificates on 31st March, 1966 was 5,703, a net increase of 186 over 1964-65. Of the 978 new factories registered during the year, only 1.7% were textile mills, while factories producing plastics and metalware accounted for about 12.9% and 11.2% respectively.
124. Table 3 records the issues of certificates and the declared value of the goods certified together with corresponding figures for the two previous years.
STANDARD CERTIFICATES OF ORIGIN
125. Standard certificates of origin issued during the year totalled 131,701, a decrease of 9.2% on the previous year's total. The declared value of goods certified showed an increase of 5.6% compared with last year's figure.
126. The department introduced coloured application forms for Certificates of Origin and Commonwealth Preference Certificates, which
30
are very similar in context and size and this has proved useful in process- ing and filing forms.
127. Following a survey of the needs of industry with regard to the use of sub-contractors, the department changed its previous certification policy and decided to permit the use of sub-contractors by factories registered for the issue of standard Certificates of Origin and Common- wealth Preference Certificates. The new system was published during September. Under this, sub-contracting of intermediate and even terminal processes of manufacture is permitted, provided the factory has notified the department beforehand of the sub-contracting concerns to which work will be delegated.
128. A revised form C & I 75, used in connexion with factory registra- tion for certification purposes, was introduced in December. The new form requires a factory to give a legal undertaking to the department relating to the observance of the conditions for registration.
COMMONWEALTH PREFERENCE CERTIFICATES
129. The number of Commonwealth preference certificates of all types issued during the year was 105,885, a decrease of 6.3% on the total for the preceding year. The declared value of goods covered by these certificates showed no significant change.
130. The department continued to ensure uniformity of practice among approved accountants in the preparation of cost statements which, together with specific raw material undertakings given by manu- facturers, form the basis of all claims to preference. In addition to guidance on general principles a number of circulars dealing with in- dividual territorial requirements were also sent to accountants.
131. Until 1963, all undertakings specifying use of raw materials of Commonwealth origin for preference purposes were given exclusively to H.M. Commissioners of Customs and Excise in London. These undertakings are now also required to be given to the department, and the revised procedure has been of assistance in supervising factories exporting to Britain under claims to preference. There is continuous consultation between the department and H.M. Customs and Excise, London, about the Preference arrangements which exist between the two territories.
132. With the agreement of H.M. Customs and Excise, London, arrangements were also set up to extend the new policy regarding sub-
31
contracting to Commonwealth Preference Certification. An essential additional feature in these procedures safeguards the identity and orgin of Commonwealth origin materials when delivered by registered factories to approved sub-contractors.
133. Close liaison is maintained with many overseas customs author- ities over certification requirements and to investigate suspected mal- practice. Arrangements with the Fiji Customs are particularly well co-ordinated and this has resulted in a number of cases of deliberate malpractice being brought to light and prosecuted through the court.
134. The issue of a revised Commonwealth Preference chart in both English and Chinese was made possible by the co-operation received from other Commonwealth territories with regard to their specific Preference requirements.
COMPREHENSIVE CERTIFICATES OF ORIGIN
135. The total number of commercial Comprehensive Certificates issued was 38,300, representing a decrease of 1.9%. The value of goods exported under these certificates showed an increase of 18.9% over 1964-65.
136. Following the discovery of extensive malpractice in exports of jade products to the United States, the department suspended the issue of Comprehensive Certificates of Origin for the export of jade with effect from 6th June, 1965. By the end of the period, it had not been possible to establish a new procedure which would provide adequate safeguards against substitution and other malpractice.
137. A new item, locally grown kudzu vine, was added in August 1965 to the list of presumptive items which may be exported to the United States under Comprehensive Certification.
138. The Foreign Assets Control of the U.S. Treasury Department announced on 10th November, 1965 that human hair products containing Asiatic human hair, formerly considered for purposes of the Foreign Assets Control Regulations as manufactures, would be regarded as processed forms of hair. Henceforth such items from Hong Kong would not be permitted entry into the United States or its dependencies unless covered by a Comprehensive Certificate of Origin. Almost all Hong Kong wig factories had been using hair of Chinese origin. The sudden imposition of this restriction and the problem of finding alternative sources of raw hair had the effect of virtually closing down the entire
32
Hong Kong wig industry for several months with resultant loss of em- ployment to an estimated 14,000 workers and a very heavy loss in export trade, which was worth approximately HK$70 million during 1965. It was not until February 1966 that the department could devise a Comprehensive Certification procedure under which wigs and other human hair products could be exported to the United States but by the end of March 1966 only one hair products factory was registered with the department for exports to the United States.
139. In order to improve the overall effectiveness of the Comprehen- sive Certification system, detailed proposals were made in April 1965 to the United States Government to adopt a simplified and standardized set of procedures. These proposals were still under consideration at the end of the period.
140. The value of mail order, tourist, and gift plan certificates is not recorded. The number of mail order certificates continues to increase rapidly-by 31.7% in the year under review. But the number of tourist and gift plan certificates fell by 10.6% and 18.6% respectively.
CERTIFICATES OF PROCESSING
141. 1,516 Certificates of Processing for goods not qualified under origin criteria to receive standard Certificates of Origin were issued during the year. The products certified included items processed or assembled in Hong Kong such as watches and transistor radios.
MISCELLANEOUS CERTIFICATES
142. The department also verified the signatures of the Superintendent of Gardens on Phytosanitary Certificates; the Director of Agriculture and Fisheries on Certificates of Origin for natural produce exported; and of certain medical practitioners on Phytopathological Certificates for hide and hair. During the year, 2,080 of these miscellaneous certificates were issued.
CHANGES IN CERTIFICATION REQUIREMENTS OF VARIOUS TERRITORIES
143. During the year under review, the Customs regulations of Fiji, Singapore and Sarawak underwent certain changes resulting in preference being accorded to additional items of Hong Kong goods. Commonwealth content requirements for Hong Kong imports into these territories were revised.
33
144. As a result of the introduction of new tariff schedule for imports into Sierra Leone the duty preferences previously accorded to imports from Commonwealth countries were abolished. Certificates of Origin and Commonwealth Preference Certificates are no longer required for imports from Hong Kong goods into that country.
145. The Zambian Government also introduced a new tariff which abolished Commonwealth Preferences. Hong Kong products therefore no longer enter Zambia at preferential rates of duty.
146. Rhodesia, after the unilateral declaration of independence, withdrew preference from Hong Kong products among the goods of other Commonwealth countries.
147. Notification was received by the Department from the French Trade Commissioner that Certificates of Origin would only be required for some fourteen categories of goods imported into France from Hong Kong.
148. Information was received from the Ministry of Commerce and Co-operatives, Tanzania, that as from 1st July, 1965, Hong Kong goods exported to Tanzania would have to be accompanied by Certificates of Origin issued by the Department, the Hong Kong General Chamber of Commerce, the Indian Chamber of Commerce, or the Federation of Hong Kong Industries.
149. The Sudanese Ministry of Commerce issued a Notice on 14th December, 1965 prohibiting all imports into the Sudan from Hong Kong. (see para. 93).
CERTIFICATION CO-ORDINATION COMMITTEE
150. As in previous years, the department continued its efforts to bring about acceptance by overseas Customs authorities of Certificates of Origin issued by the Hong Kong General Chamber of Commerce, the Indian Chamber of Commerce and the Federation of Hong Kong Industries, all of which are designated by Government as competent to issue Certificates of Origin under the International Convention relating to the Simplification of Customs Formalities, 1923.
151. The Certification Co-ordination Committee, which comprises members of all the designated organizations and was chaired by the Assistant Director, Textiles and Certification Division, met on several
34
occasions to ensure a uniform approach to origin criteria, certification procedures and negotiations with overseas authorities on origin matters generally.
VISITS
152. In March 1966, the Director of the Foreign Assets Control of the U.S. Treasury Department, Mrs. Margaret SCHWARTZ, paid a visit to Hong Kong. While here, she held discussions with officers of the department on matters relating to the operation of the comprehensive certification system. Arrangements were made for Mrs. SCHWARTZ to visit a number of local factories and tourist shops.
CERTIFICATION REVENUE
153. Fees for certificates of origin are collected in the form of stamp duties, which are $10 for standard Certificates of Origin and Common- wealth Preference Certificates, $35 for commercial comprehensive certificates, and $5 for all other certificates. Revenue from all types of certificates amounted to $4,453,585, which was 5.5% less than in the previous year.
V. INDUSTRY INSPECTION BRANCH
GENERAL
154. The work of the Industry Inspection Branch is an integral and essential part of the system under which the department issues various types of Certificates of Origin. The Branch is responsible for physical policing in the factories of the complicated administrative controls for various types of certification for Hong Kong products. The efficient functioning of the Industry Inspection Branch has an important bearing upon the acceptance of Hong Kong products in overseas countries and therefore upon the good trading name of the Colony. The main functions of the branch consist of inspections of factories in order to assess their productive capacity and ability to comply with certification procedures before their application for registration with the Department for cer- tification purpose is approved; subsequent inspections to ensure that specific consignments of goods were produced in the factories; investiga- tions arising from discrepancies or malpractice discovered during these inspections; and prosecutions in the courts as a result of the investigations.
35
The Branch also carries out limited industrial surveys and helps to main- tain inspectional systems designed to reduce the problems of health and safety hazards in Hong Kong products. There are at present over 5,700 factories registered for the issue of various certificates; an average of 35,000 certificates are issued each month; and well over two thousand individual factory or consignment inspections are carried out monthly.
STAFF
155. From October 1965, the Branch was headed by a Senior Industry Officer directly responsible to the Assistant Director in charge of the Textiles and Certification Division. Twenty-one former Preventive Service officers were appointed to the new grades of Senior Industry Assistant, Industry Assistant Class I and Industry Assistant Class II with effect from 1st November, 1965. By the end of the year, the Branch had a strength of thirty-seven officers including a number of officers seconded from the Preventive Service. The strength was well below the approved establishment of seventy-seven posts, and serious problems were experienced as a result. Work commitments had to be dealt with under a strict priority system but, even so, essential inspectional work had to be reduced below the minimum level necessary for operational efficiency. Efforts were made to accelerate recruitment and training of new officers and it is not likely that the Branch will be up to strength until late 1966.
INSPECTIONS
156. During the period under review, the Branch carried out a total of 9,258 factory and consignment inspections (excluding those at the Kowloon Inspection Control), 4,775 less than in the previous year. The decrease was mainly due to the shortage of trained field staff referred to in the preceding paragraphs but to some extent also to the emphasis laid on the quality, rather than the number, of inspections carried out. The Branch also carried out inspections at factories producing goods which were the subject of overseas complaints about health or safety. Samples of these products were obtained by officers of the Branch and submitted for test or analysis. Regular sampling of Hong Kong plastic toys was introduced in March 1966 as a means of ensuring compliance by Hong Kong toy manufacturers with health standards established in Britain.
36
157. A breakdown of the inspection figures for 1965–66 is as follows:
(i) Initial registration for certification purposes
(ii) Routine re-inspection
(iii) Preference undertakings
(iv) Comprehensive Certificates of Origin procedures
...
+
3,409 3,834
269
...
983
...
•
(v) Tourist Comprehensive Certificates of Origin application
checks
(vi) Textile quota controls
(vii) Consignment spot checks
...
68882
32
•
...
442
...
9,258
KOWLOON INSPECTION CONTROL
158. In addition to the field inspections reported in paragraph 156, the Kowloon Inspection Control situated in the Hong Kong & Kowloon Wharf & Godown Co.'s premises carried out physical examinations of certain categories of consignments prior to shipment as shown below:
1965-66
1964-65 1963-64
16,526 16,999
15,709
...
2,525
3,377
3,421
77
36
Nil
(i) Selected items under Commercial
Comprehensive Certificates of Origin. (ii) Cotton garments and made-up goods
exported to the United Kingdom under the high cost content scheme
...
(iii) Antiques to the United Kingdom
...
(iv) Embroidered handkerchiefs and naperies
under Standard Certificates of Origin/ Commonwealth Preference Certificates...
Total
Nil
18
28
...
19,128 20,430
19,158
159. Arising from the consignment inspections, fifty-four applications for certificates were referred for further investigation.
INVESTIGATIONS
160. 306 investigations were initiated and 280 concluded during the period. 85 factories were warned of technical infringements of departmental registration procedures or legal undertakings where it was within their competence to take immediate remedial action. The registration of 65 factories was suspended for a total period of 181 months and a further 67 factories were suspended pending completion of detailed investiga- tions. Twenty factories and tourist shops were removed from the cer- tification register due to malpractice.
37
161. Factories affected by administrative or legal action fell into three broad groups, namely:
(a) woollen knitting factories which subcontracted the manufacture
of goods to unauthorized firms;
(b) cotton garment factories which breached Preference undertakings
to the department or H.M. Customs and Excise, London;
(c) factories found in breach of Comprehensive Certificates of Origin
procedures.
162. Close liaison was maintained with overseas Customs authorities, particularly those for the United Kingdom and other Commonwealth territories, and a number of investigations were carried out at their request.
PROSECUTIONS
163. The Prosecution Section dealt with an unprecedented number of cases and 124 factories, export firms and dealers were prosecuted for making false declarations on applications of Certificates of Origin or related documents, or breaches of undertakings to the Department and U.K. Customs and Excise, London, as compared with only 15 prosecu- tions during 1964-65. The fines imposed on offenders totalled $195,900, which was ten times greater than the figure for 1964-65. Below is a summary of the prosecutions undertaken:
(i) Total actions
(ii) Persons arrested
...
Persons or companies summoned ...
(iii) Total fines
:
221
56
...
...
68
$195,900
ANTI-CORRUPTION MEASURES
164. Two members of the public were sentenced to imprisonment for six months for making corrupt offers to Branch officers. A further 15 people were warned for similar offences where there was insufficient evidence to prosecute. The Branch continued its efforts, by letters and by discussions and interviews, to impress upon manufacturers that they should not under any circumstances offer money or any other form of inducement to Branch officers. There were encouraging signs by the end of the period that this form of positive education in anti-corruption was beginning to have good results.
38
VI. INDUSTRIAL DEVELOPMENT BRANCH
Textile Spinning
REVIEW OF INDUSTRY
165. At the end of the period under review, there were 33(31*) cotton spinning factories registered with the department for certification purposes, employing over 21,100 (21,000) workers, and operating 724,722 (715,500) spindles, an increase of 9,222 spindles over the total at the end of the previous year. Production of cotton yarn was approximately 289 (261) million lbs. ranging mainly from 10s. to 60s. counts, carded and combed in single or multiple threads.
166. Wool spinning further expanded during the year and production of woollen and worsted yarn increased by about 42% (9%), from 12.3 million lbs. in 1964 to 17.4 million lbs. in 1965.
Textile Weaving
167. Production in the cotton weaving sector registered a substantial increase during the year. Expansion in the capacity of the cotton weaving sector of the textile industry continued on a diminishing scale. At the end of March 1966, there were 179 (178) cotton weaving factories registered with the department for Certificates of Origin, with a total of 21,198 (20,700) looms installed.
168. Total production of cotton piecegoods was approximately 650 (579) million square yards, and consisted chiefly of cotton grey drill, shirtings, poplin, gingham, canvas and other bleached and dyed cloth and prints.
Textile Finishing
169. The capacity of the finishing industry was considerably augmented with the setting up of one large finishing and dyeing factory, with facilities to process polyester fabrics. This new plant is a joint venture between Hong Kong and Japanese interests.
Cotton Knitting
170. Development in one of the oldest sectors of the textile industry, cotton knitting, was almost static. According to records compiled by the Labour Department, at the end of March, 1966, there were 252 (247) cotton knitting mills employing 9,394 (10,237) workers. Products were
* Last year's figure is shown in brackets.
39
mainly cotton interlock materials for use by the garment industry. Warp- knitted cotton fabrics were also produced.
Woollen Knitting
171. The woollen knitwear industry continued its rapid growth. At the end of March 1966, there were 231 (172) factories in operation, employing some 17,800 (13,000) workers. Exports of woollen knitwear of all types, including gloves, were valued at HK$508 million, an increase of 31.6% over the previous year.
Wearing Apparel
172. Hong Kong manufactures a very wide range and variety of garments including shirts, underwear, outer-wear (both knitted and woven), neckwear, golves, hats and caps, socks and stockings. By the end of March, 1966, the industry employed a labour force in excess of 65,150 (64,700) workers in 1,223 (1,100) industrial undertakings. The value of exports in 1965-66 reached $1,796 ($1,684) million, an increase of 6.6% on the value for the previous year. The production of permanent- crease garments, a new invention in the field of garment manufactures, was introduced on an experimental basis during the year.
Plastics
173. The plastic ware industry is the second largest industry in Hong Kong in terms of employment production and export earnings. In March 1966 there were 45,280 (42,040) workers employed in some 1,300 (1,200) factories. Exports of plastic products, with the exception of plastic flowers, registered an increase.
174. For the first time, exports of plastic flowers, fruit and foliage declined, owing to the decrease in demand in the U.S.A. and United Kingdom, the two principal markets for Hong Kong plastic flowers. Exports in the period were valued at $246 million compared with $277 million in 1964-65.
Light Metal Products
175. By March 1966 there were 1,190 (1,037) factories manufacturing light metal products with a total labour force of 32,180 (32,750). Enamel- ware and metal torches continued to be the largest sectors of this industry.
176. The enamelware industry continued its gradual decline as more developing countries undertook their own manufacture, sometimes with
40
assistance from Hong Kong. Exports of enamelware for the period 1965-66 amounted to $38.4 ($48.6) million. Towards the end of the period under review, four factories amalgamated to form one single concern. This trend of horizontal amalgamation is likely to continue in the face of fierce competition from abroad and other difficulties inherent in this industry.
177. Hand torches and lanterns continued to be one of the major lines. There was a further slight increase in the number of factories (from 45 to 46), but the number of workers dropped from 5,500 to 4,770. Exports amounted to $72.6 million as against $68.2 million in the previous year.
178. There was no significant development in the stainless steel cutlery industry. At the end of the period, there were only eight factories engaged in this industry, employing 1,420 workers. Value of exports in 1965–66 was $14.57 ($11.33) million.
Electronics
179. The electronics industry continued to be the fastest growing industry in Hong Kong, particularly in the components and sub-assembly sectors. In March 1966, there were four factories producing silicon transistors, four factories engaged in the production of computer com- ponents and another eleven factories were producing radio components and sub-assemblies. Exports of transistors in 1965-66 were valued at $70 million, while exports of T.V. tuners amounted to $29 million.
180. The manufacture of transistor radios continued to grow. During the year, exports of radios amounted to $130 million, compared with $96 million last year. There were 39 factories in the radio industry at the end of March 1966.
Hair Wigs
181. Another relatively new industry made spectacular gains in exports during the year. This was the hair wigs industry which by September 1965 was believed to employ over 14,000 workers mostly on a cottage type basis. Exports, mainly to the United States, amounted to HK$70 million during 1965 but trade was seriously reduced at the end of 1965 when the United States authorities placed a ban on imports until Chinese origin raw hair used in the production of Hong Kong wigs could be replaced by hair of other origin. Exports to the United States had not recommenced by the end of March 1966.
41
Machinery
182. The manufacture of machinery, mainly for sale to local factories and workshops, continued to expand. Machines produced included textile machinery, diesel engines, diesel operated generators and pumps, plastic moulding machines, power presses, lathes, planing machines and platen presses. This industry recorded useful exports during the year.
Shipbuilding
183. Activity in the shipbuilding and repair industry continued satisfactorily, with orders both from overseas and local, mainly for repair and maintenance work. In March 1966, the industry employed 11,400 (10,800) workers.
184. Small vessels, particularly pleasure craft, continued to sell well; craft with fibre-glass reinforced-plastic hulls gaining rapid and increasing acceptance in overseas markets. Exports for the year of yachts, pleasure cruisers and other small craft were valued at $20.98 ($17.88) million. Shipbreaking and Steel Rolling Mills
185. 1965-66 was yet another disappointing year for this industry, although the number of vessels broken up, viz. 35 (25) vessels totalling 257,000 (164,000) gross tons, was slightly above last year's figure. The continued high prices for old vessels, competition from Japan and Taiwan in the vessel purchasing markets, the falling off in demand for mild steel round bars by the domestic construction industry and the competition from imported Japanese steel bars all contributed to the low level of activity in this industry.
186. A total of 2.4 million square feet of land in Junk Bay has been sold to 24 shipbreakers, 1.7 million square feet being on the western shore and 0.7 million square feet on the eastern shore. Although, partly for technical reasons, some delay has occurred in the development of these sites, the reclamation works and sea wall construction on the whole made good progress. Most of the sites are expected to be in pro- ductive use within the next two years.
LAND FOR INDUSTRY
187. In order to assist Government in formulating and executing its policy regarding industrial land and to provide information and assistance regarding the availability of industrial sites to potential in- vestors, the Branch maintains up-to-date information on the major industrial development areas.
42
Kwun Tong
188. By the end of March 1966, reclamation to form the site of the Kwun Tong industrial town was complete. In March 1966, 352 (243) factories were in operation there, and construction work was completed or in progress on a further 35 (56) sites.
Tsuen Wan Kwai Chung District
189. The reclamation scheme in this area, which is the largest so far, went ahead satisfactorily. This scheme is designed to provide about 10 square miles of land to form an industrial town with a 1.2 million population in the area of Tsuen Wan, Kwai Chung and Tsing Yi Island. The older part of the reclamation area is already intensively developed and industrial sites in the newly reclaimed area of Kwai Chung valley started to become available during 1966.
Industrial Land Sales
190. Early in 1965, there was a sharp decline in industrial land sales and in land prices. During the period, only 2 sites were sold in Kwun Tong, compared with 41 during the previous year. Another 6 industrial sites in the urban area were sold. Unit land prices, which have fallen by about a third, ranged from $25.10 to $60.74 per square foot. In the New Territories, a total of 15 sites were sold by auction and regrant.
INDUSTRIAL CO-OPERATION
191. In common with most other developing countries, Hong Kong is anxious to attract capital and/or expertise into various forms of joint enterprise with its industrialists or commercial entrepreneurs. The In- dustrial Development Branch is responsible within the Department for activities in this sphere, including liaison with trade and industrial associa- tions, banks, foreign consulates and missions and the Government In- formation Services. Discussions were held with 52 (84) overseas visitors in connexion with potential joint ventures. In addition, 53 (150) visitors called on officers of the Branch to assist them with introduction to or to obtain information on possible suppliers of goods in which they were interested. A number of visits to factories were organized on their behalf.
General
HEALTH AND SAFETY ASPECTS OF HONG KONG PRODUCTS
192. The Branch continued to investigate overseas complaints con- cerning alleged health and safety hazards in Hong Kong products. Most
43
•
of these complaints arose in Britain where there has been increasing concern from consumer protection agencies over all aspects of health and safety in consumer goods and particularly in toys and children's play- things. The British Home Office initiated a series of discussions in Britain to consider health and safety standards for toys and it appeared by the end of the year that several new standards would be given legal or in- stitutional validity. Since the Hong Kong toy trade with Britain has very substantial economic significance, the Hong Kong Government has maintained close consultation with the Home Office and this has proved helpful in deciding the measures necessary in Hong Kong regarding developments in Britain on health and safety standards. The Branch worked closely with the Hong Kong Government Office in London on the question of toys and with the Labour Department and the Medical and Health Department in Hong Kong.
193. A number of circular letters were sent to registered toy manufac- turers to assist the industry to understand the nature of the problem and to help industrialists to overcome problems with specific products. Copies of the British Standard Specifications for toys and children's playthings were also distributed to registered factories.
Drink Coolers
194. As a result of complaints from the U.S.A., United Kingdom and Australia, that the water contained in drink coolers exported from Hong Kong was contaminated, tests were initiated by the Branch and carried out by the Medical and Health Department. These confirmed that the water in many drink coolers was contaminated and, although not dan- gerous to health, the degree of contamination was unacceptable for a product of this nature. Accordingly, the exportation of drink coolers was stopped and manufacturers were asked to destroy stocks under supervision. It became clear during these investigations that the working arrangements in factories manufacturing drink coolers were unsatisfac- tory from the point of view of health standards. In order to provide an acceptable basis for future production, the Medical and Health Depart- ment, the Urban Services Department and the Labour Department in conjunction with the Commerce and Industry Department established a Code of Practice to be used in factories producing drink coolers. The Code covers the entire process of manufacture and would ensure an acceptable hygiene standard for the finished product. Copies of the Code were sent to the United States and British authorities for consideration. By the end of the year, however, drink cooler production had not restarted.
44
Toys-Lead Content
195. Following a number of complaints from Britain about alleged health risk arising from lead content in surface paints and plastic materials used in the production of Hong Kong toys, the Department, acting on advice from the Medical and Health authorities, introduced a random sampling and testing service covering surface paints to assist Hong Kong toy manufacturers. Samples of toys are drawn from time to time by officers of the Department and submitted to the Government Chemist for analysis of the paints used. Manufacturers are advised of the results of these tests and, where any paint is considered unsuitable, are requested to discontinue its use and, if necessary, to destroy any toys which might be considered to represent a health risk.
Toys-Safety Hazards
196. The Branch investigated a number of overseas complaints about danger to public safety arising from faulty design features or inadequate material in Hong Kong toys. Some of these complaints were considered to have no valid basis but others were justified. In these latter cases, the Branch proposed modifications to the Hong Kong manufacturers concerned and in all cases these were incorporated.
ECONOMIC COMMISSION FOR ASIA AND THE FAR EAST
197. The Branch was responsible for briefing the Hong Kong dele- gation to the First Asian Conference on Industrialization held in Manila from 5th-20th December 1965. The delegation which consisted of three members, was led by Dr. S. Y. CHUNG, a member of the Trade and Industry Advisory Board.
198. The Branch also briefed another three-member delegation which attended the 18th Session of the E.C.A.F.E. Committee on Industry and Natural Resources held in Bangkok from 4th to 14th February, 1966. This delegation was led by Mr. James M. H. Wu, a member of the Trade and Industry Advisory Board.
Commonwealth Standards Conference
199. Mr. C. P. HADDON-CAVE, Deputy Director, attended the Sixth Commonwealth Standards Conference held in London from 20th to 27th July 1965. This was the first of these conferences at which a Hong Kong delegate was present and Hong Kong representation was considered necessary in view of the increasing attention being paid by Hong Kong
45
industrialists and exporters to the advantages to be obtained from working to internationally known technical standards of utility and quality. Policy questions discussed included conversion to the metric system, streamlining preparation of standards, informative labelling of products, standards for consumer goods, testing and certification facilities and various means of improving co-ordination between participating countries.
200. Hong Kong will become increasingly involved in the development and use of standards for industrial products as industry produces more sophisticated items and overseas buyers become more concerned with technical quality.
Immigration Enquiries
201. The Branch assisted the Immigration Department in checking the credentials of applicants who wished to enter Hong Kong to establish a business or to take up employment in commerce and industry.
PROVISIONAL PRODUCTIVITY COUNCIL
202. The Provisional Productivity Council established to implement the recommendations of the Working Committee on Productivity (sub- mitted to the Legislature in July, 1964) met for the first time on the 4th May, 1965 under the chairmanship of the Director of Commerce & Industry.
203. As a result of that meeting a Working Group of ten Members of the Provisional Productivity Council was formed to:
(I) Advise on the preparation of draft legislation for the establishment
of an autonomous Productivity Council;
(II) Submit proposals for the establishment of a Hong Kong Pro-
ductivity Centre;
(III) Recruit an Executive Director and Staff for the proposed Pro-
ductivity Centre; and
(IV) Supervise Hong Kong participation in the activities of the Asian Productivity Organization and generally coordinate productivity activities pending the establishment of a Productivity Centre. 204. The Working Group, under the chairmanship of Dr. S. Y. CHUNG of Sonca Industries Limited, met seven times between the 27th May, 1965 and the 31st March, 1966 and by the end of the preliminary work was far advanced under all these heads. Draft legislation was in being, premises had been secured for the Productivity Centre, a Secretariat had
46
been established and guidelines had been laid down for the recruitment of an Executive Director and supporting administrative staff.
ASIAN PRODUCTIVITY ORGANIZATION
205. During the year under review a total of 22 Hong Kong nominees approved by the Working Group of the Provisional Productivity Council participated in 4 study-missions in India and Japan, 1 seminar in Taipei, 2 symposia in Manila and Madras and 3 specialized training courses in Japan. In addition to these overseas activities, three seminars were held in Hong Kong itself run by the Hong Kong Management Association— under the joint sponsorship of the Asian Productivity Organization and the Hong Kong Government. A total of 42 nominees attended these three seminars including 21 nominees from other Asian countries.
206. In April 1965 Mrs. S. YUEN of the Hong Kong Management Association and Mr. K. S. HUIE of the Department attended the 5th Workshop Meeting of the Asian Productivity Organization in Manila, and in December Mr. T. D. SORBY, Deputy Director of Commerce & Industry and Mr. A. C. SLATER, Secretary of the Provisional Productivity Council, attended the 6th Governing Body Meeting of the Asian Pro- ductivity Organization in New Delhi.
207. Important decisions on policy and operational procedure were taken at these meetings including a decision to include agricultural productivity within the ambit of the Organization's future activities and another to admit South Vietnam and Iran to full membership of the Asian Productivity Organization, making a total of 11 member countries, including Hong Kong.
208. Full reports on these meetings were submitted to the Trade and Industry Advisory Board.
VII. TRADE DEVELOPMENT BRANCH
Milan Samples Fair 1965
OVERSEAS ACTIVITIES
209. Hong Kong's participation in the Milan Samples Fair which was held between 14th and 25th April, took the form of a commercial information office on the first floor of the main exhibition building with a smaller information booth on the ground floor. Only one local firm exhibited independently compared with five firms in the 1964 Fair.
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210. The delegation led by Dr. S. Y. CHUNG comprised Mr. Y. L, LEUNG, Mr. R. PIECIOTTO and two officers from the Department.
211. Unlike the previous year, business activity at the Fair started slowly. There were three main reasons for this, the general malaise of the Italian economy, the coincidence of the Easter holidays with the first few days of the Fair and the transport strike which deterred both overseas and Italian visitors. Despite these adverse circumstances business done was satisfactory and over 35,000 people called at the information booth. A total of 176 positive trade enquiries were received, twenty of which were concerned with industrial joint ventures.
Sixth Tokyo International Trade Fair
212. Hong Kong participated for the first time with an official exhibit at the Sixth Tokyo International Trade Fair held from 16th April to 6th May 1965. The Hong Kong stand covered an area of 1,550 square feet in the International Pavilion. The stand displayed a wide variety of Hong Kong products and included a section organized by the Hong Kong Tourist Association equipped with a film projector.
213. The delegation was led by the Hon. FUNG Ping-fan, O.B.E., J.P., with Mr. T. K. ANN as deputy leader. Other members of the delegation were Messrs. Frank C. H. JEN and J. L. C. PEARCE, M.B.E., a represen- tative from the Information Services Department and two members of the department.
214. The Hong Kong stand attracted good publicity from the press, radio and television and many distinguished people visited the stand, including His Royal Highness Prince AKIHITO and Mr. Eisaku SATO, the Japanese Prime Minister.
215. A total of 194 enquiries were recorded during the fair. Items which attracted particular interest were wooden and rattan furniture, beaded dresses, toys, plastic flowers, torches, metal lanterns, handbags and wigs.
216. The entire exhibit with the exception of the JADE jewellery was sold to the Tokyo Branch of the Daimaru Department Store at the end of the fair.
East Africa Mission
217. Under arrangements made by the Overseas Trade Relation Branch a Trade Mission to East Africa left Hong Kong on the 11th June, 1965 and returned to the Colony on the 15th July, 1965. The Hon.
48P. Y. TANG, J.P., led the Mission, the other members being J. S. LEE, H. J. SHEN, Paul LAU and E. I. LEE, Assistant Director, and two other officers of the Department accompanied the Mission. The visit of the Trade Mission to East Africa and Zambia coincided with the imposition of severe import restrictions on the entry of Japanese goods to Kenya, Tanzania and Uganda. Merchants who had previously imported from Japan were therefore looking for alternative sources of supply and were actively interested in obtaining details of the merchandise which Hong Kong had to offer. The Mission was impressed by the determination of the African Governments to develop greater African participation in business, and they recommended that strenuous efforts should be made to cultivate good relations with the new commercial organizations which each Government had or was about to set up to achieve these ends. In Zambia, no ban on the entry of Japanese goods existed. The Mission found, however, that the Government, for political reasons, was anxious to reduce the volume of its trade with its traditional suppliers-South Africa and Southern Rhodesia, and was actively seeking new sources of supply.
218. The Mission had no doubt that, if the opportunities which political and economic changes were providing were to be realized, a considerable selling effort would have to be made and maintained for the next few years by Hong Kong merchants and manufacturers in the four countries visited. The Mission's main recommendation was, therefore, for the appointment of a Hong Kong Trade Representative in East Africa to cover the three East African countries and Zambia. This pro- posal was accepted by the Trade and Industry Advisory Board, and later by the Government, and Mr. G. J. CONNINGTON was appointed to fill the post. Mr. CONNINGTON had had 20 years successful business experience behind him in East Africa, was thoroughly conversant with the people and all the countries concerned and with the existing political situation and trading practices in the area. The Mission also recommended that its visit should be followed up with as much speed as possible by a direct selling delegation to be advised and accompanied by the Hong Kong Trade Representative. A selling mission organized by the East African Sub-Committee of the Joint Public Relations Committee of the Hong Kong General Chamber of Commerce and the Federation of Hong Kong Industry, led by Mr. Henry S. H. FUNG, left Hong Kong on the 29th October, 1965 and spent three weeks in East Africa. On their return, satisfaction was expressed by members of the Mission on the results achieved and on the potentialities of the area.
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International Fire Exhibition and Conference
219. In 1964 the Fire Services Department decided to participate in the International Fire Exhibition and Conference. Although the main purpose of attending the exhibition was to demonstrate Hong Kong's up to date approach to fire prevention and fire fighting, the opportunity was taken to include a small display of products used in this field. The department agreed to assist in the collection, selection and despatch of exhibits.
220. The exhibition was held at Olympia, London, from 26th to 31st July 1965 and Hong Kong was represented by a stand of 1,500 square feet made up of an exhibit of 1,000 square feet illustrating by means of photographs, pamphlets, models and films the problems of the Fire Services Department and a 500 square feet display of locally manufactured fire fighting and fire prevention equipment.
221. A total of 92 trade enquiries were received during the exhibition, Items which attracted most interest included footwear, fire alarms, torches and lanterns, metal badges, shirts, hose couplings and valves.
Exhibit at the Bull Ring Birmingham and Department Store Displays
222. The opportunity to exhibit a wide range of Hong Kong products direct to the shopping public in a large industrial area prompted Hong Kong to accept an invitation to stage a display in the new Bull Ring shopping centre of Birmingham from 4th to 17th July 1965. This was a joint project of the department, the Public Relations Joint Committee of the Hong Kong General Chamber of Commerce and the Federation of Hong Kong Industries and the Hong Kong Tourist Association.
223. The Hong Kong display covered an area of 4,250 square feet inside a covered exhibition site surrounded by shops. The exhibits were displayed in showcases specially designed to accommodate various groups of products. A low platform was divided by a self-supporting wall with a French window to form two separate areas for the display of indoor and outdoor furniture, furnishings and sports equipment. Other goods dis- played included electrical goods, glassware, porcelain, jewellery, plastic goods and wearing apparel. The display was bordered with seven double sided units displaying photographs of life in Hong Kong. The centre piece of the display was a square tower which served as an enquiry office.
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224. A reception to mark the opening of the Hong Kong display was attended by the Lord Mayor and Lady Mayoress of Birmingham Sir Alexander GRANTHAM representatives of the Birmingham and Midlands Chamber of Commerce and leading businessmen. The display received valuable press publicity and a film advertising the display was shown in four Birmingham cinemas. Two Cathay Pacific Airways stewardesses who promoted tourism at the stand also received considerable press coverage.
225. A total of 109 enquiries were received with particular interest centred on wearing apparel, piecegoods, toys, wooden furniture, transistor radios and jewellery.
226. As a follow up to the exhibition in Birmingham, a series of 'Hong Kong Fortnights' were arranged with department stores as follows:
: From 25th August to 4th September 1965.
Lewis's Leeds
Lewis's Manchester: From 8th to 18th September 1965.
Lewis's Glasgow
:
From 22nd September to 2nd October 1965.
Lewis's Bristol
:
From 16th to 26th February 1966.
From 11th to 26th March 1966.
Selfridges Ilford :
227. The department store displays were similar to the display at the Bull Ring, Birmingham and increased the opportunity to show a wide selection of Hong Kong products to the shopping public. Each store dressed at least one of its shop windows with Hong Kong goods during the promotion and Hong Kong goods on sale were specially identified.
228. The displays attracted valuable press publicity and special sup- plements on Hong Kong were arranged with leading local newspapers. A short film advertising the display was also shown in each city.
Commonwealth Arts Festival
229. The organizers of the Commonwealth Arts Festival in conjunc- tion with the Council of Industrial Design arranged for an exhibition of textiles, ceramics and wood carvings to be held from 15th September to 6th October 1965 at the Design Centre, London.
230. Hong Kong was invited to participate and while the Director of Information Services was responsible for this project, the department assisted in the collection of exhibits.
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Sydney International Trade Fair
231. The Third Sydney International Trade Fair was held from 19th to 30th October 1965 and Hong Kong participated for the third time in this event. The Hong Kong stand covered an area of 1,500 square feet. Of this area, 400 square feet was booked by the Hong Kong General Chamber of Commerce, 300 square feet by the Hong Kong Tourist Association and the remaining 800 square feet was utilized by the depart- ment for the display of a wide variety of Hong Kong products.
232. The stand was designed to give an overall oriental image. The exhibits could be seen without the need to enter the stand and thus members of the public were able to see what Hong Kong had to offer by walking around the stand and businessmen could be received inside for discussions in comfort. The department's area of the stand comprised displays of products incorporated into a dining room setting and sections devoted to camping, novelties and gifts, textiles and miscellaneous items. The Hong Kong General Chamber of Commerce area displayed furniture and furnishings and the Hong Kong Tourist Association area had several features of interest to tourists.
233. The Hong Kong delegation was led by Mr. Q. W. LEE, J.P. and included Mr. H. C. YUNG the deputy leader, Miss Joy DRAKE (Miss Hong Kong 1965), Mr. P. WOOD of the Hong Kong General Chamber of Commerce, a representative from the Information Services Department and two members of the department. The delegation was joined in Sydney by the staff of the Sydney Office and a representation of the Hong Kong Tourist Association. Two hostesses from Cathay Pacific Airways also assisted at the stand.
234. Six fashion parades were held during the fair, two following the official reception and four to which members of the public were admitted. It is estimated that over 2,500 persons saw the fashion parades during which thirty garments ranging from swimsuits to evening dresses were modelled by Miss Joy DRAKE and two leading Sydney models.
235. Publicity on Hong Kong's participation commenced in July 1965 with a special Hong Kong supplement in the Sydney Morning Herald and this was followed in October with a supplement in the Austra- lian Financial Review. Advertisements were also included in several other leading Australian newspapers. The design of the Hong Kong stand and the fashion shows generated considerable publicity and a short film of the shows was shown on several television networks. Five films on Hong Kong were also shown in the trade fair theatre during the exhibition.
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236. A total of 799 enquiries were recorded during the fair. Products of particular interest included clothing, wooden furniture, toys and dolls, cameras, plastic goods, glassware, cutlery, building materials and sports equipment.
Planning and Preliminary Work for Future Overseas Activities
237. In preparing a programme of export promotion activities for the financial year 1966–67 it was necessary to keep in mind the Working Committee appointed to discuss the proposal that a central export pro- motion organization should be set up in Hong Kong. It was also impor- tant to consider the activities of other bodies likely to become part of the central organization, in particular the Public Relations Joint Commit- tee of the Hong Kong General Chamber of Commerce and the Federation of Hong Kong Industries. Noting the Joint Committee's concentration of its activities in North America, the programme proposed by the depart- ment therefore concentrated on Europe.
238. The Trade and Industry Advisory Board and the Working Committee on Export Promotion Organization recommended that Hong Kong should participate for the first time at the Barcelona International Samples Fair to be held from 1st to 15th June 1966. The Hong Kong stand will feature a combined commercial and prestige display of a wide range of local products and will also include an information office organized by the Hong Kong Tourist Association.
239. Preparations for this event commenced in September and a senior officer from the department visited Barcelona in early November, 1965 and had discussions with British Consular Representatives, the trade fair authorities and a number of companies specializing in stand design and construction, customs clearance and public relations.
240. It was also agreed that Hong Kong should participate in the St. Eriks' International Trade Fair, Stockholm, to be held from 31st August to 11th September 1966. This is the second time that Hong Kong has participated at this event, the first time being in 1960.
241. Preparations commenced in October and it was decided that a combined commercial and prestige display would be the most rewarding. In November, a senior officer visited Stockholm to discuss this project with British Embassy officials, the trade fair authorities and companies specializing in trade fair and public relations activities.
242. As a follow up to the exhibition at the Bull Ring, Birmingham and subsequent department store displays, the Trade and Industry
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Advisory Board and the Working Committee on Export Promotion Organization agreed with a proposal of the Public Relations Joint Commit- tee that a display should be arranged at Selfridges. Department Store, London, in September 1966. Preparatory arrangements were made by the London Office and the officer who visited Barcelona and Stockholm also visited London to discuss details of the display.
243. The Trade and Industry Advisory Board and the Working Committee on Export Promotion also recommended that Hong Kong should participate at the First Asian International Trade Fair, Bangkok, .to be held under the auspices of the Economic Commission for Asia
and the Far East from 17th November to 10th December 1966.
244. Hong Kong will have its own pavilion at the fair and it is pro- posed to organize a combined commercial and prestige display of a wide variety of local goods. Preparations for this event commenced in September and in October, Mr. R. H. C. HAMMOND, ECAFE Adviser on the Bangkok Fair visited Hong Kong to discuss participation with members of the department, Hong Kong General Chamber of Commerce, Federation of Hong Kong Industries, Chinese Manufacturers' Association and local businessmen.
LOCAL TRADE EXHIBITIONS
Display Centre of Hong Kong Products
245. The Display Centre of Hong Kong Products inaugurated on a trial basis in October 1962, aims to display domestic manufactures in an attractive setting and to give a specialized service to prospective buyers. Conveniently situated in the High Block of the City Hall, the Centre continued during the year to be a point of contact between business visitors and local suppliers.
246. Over 8,300 persons visited the Centre during the past year. In addition, the Centre was visited by trade missions from Spain, Africa, the United States and the United Kingdom. Members of international groups such as the Lions and ASTA who came to Hong Kong to attend special conventions also paid visits. A notable visitor was the Earl of Snowdon, who came in March during British Week in Hong Kong. The Centre handled about 10,000 trade enquiries, over half of which came from overseas visitors. Nearly 500 business appointments were made between overseas visitors and local suppliers.
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247. As it became clear that the Display Centre was a valuable adjunct to the Colony's trade promotion efforts, the Governor-in-Council decided that the Centre should continue to be part of the Colony's over- seas trade promotion programme. The Display Centre will therefore move into new premises in the Ocean Terminal as part of the Trade Development Council. The Centre will re-open in May 1966.
248. Running costs of the Display Centre, including staff salaries, amounted to approximately $124,300 over the period.
OVERSEAS TRADE MISSIONS, EXHIBITIONS, ETC.
Floating Rhodesia Tobacco Exhibition
249. A floating Rhodesia tobacco exhibition sponsored by the Tobacco Export Promotion Council of Rhodesia visited Hong Kong from 21st to 24th August 1965.
Japanese Products Exhibition
250. The ninth Japan Trade Exhibition was held at the Japan Trade Centre from 25th to 30th October, 1965. A wide variety of products were displayed including jewellery, medicinal products, household goods, electrical appliances and clothing.
Japan West Prefectures Products Exhibition
251. The 2nd Japan West Prefectures Products Exhibition was held at the Japan Trade Centre from 18th to 20th November 1965. Exhibits included machinery, foodstuffs, textiles, household appliances and stationery.
Chinese Toys Exhibition
252. An exhibition featuring a wide variety of toys and games currently being produced in China was held in the City Hall from 15th to 23rd November, 1965.
Swiss Watch Exhibition
253. An exhibition of Swiss watches entitled "Time Measurement, Past, Present and Future', sponsored by a leading Swiss watch manu- facturing company was held in the City Hall from 17th to 29th December, 1965. The exhibition was opened by Mrs. HOLMES, wife of the Director.
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Sixth Japan Industry Floating Fair
254. The Sixth Japan Industry Floating Fair on board the s.s. ‘Sakura Maru' visited Hong Kong from 6th to 13th February 1966. A wide range of goods were on display illustrating the latest developments in Japanese industry.
British Week
255. The British Week organized by the British National Export Council's Committee for Exports to Asia and the Board of Trade was held in Hong Kong from 3rd to 12th March 1966. It was basically a commercial operation backed up by cultural and social supporting events whose object was to create a British atmosphere in Hong Kong and attract people into the shops where British goods were prominently displayed.
256. During British Week an Engineering Display organized by the British Engineering Display Committee under the Chairmanship of Pro- fessor Sean MACKAY of Hong Kong University was also held in the new Ocean Terminal building and enabled over 200 British companies to show their engineering and technological achievements. In addition, the Cable and Wireless ship, Cable Enterprise, which is taking part in the SEACOM project, was moored alongside the Ocean Terminal and open to the public during the exhibition.
257. Her Royal Highness, Princess Margaret and the Earl of Snowdon visited Hong Kong to open officially British Week in the City Hall and the British Engineering Display. The Royal Party met many prominent businessmen and also attended a fashion display at the Mandarin Hotel.
Trade Missions
258. A record number of thirty-five trade missions visited Hong Kong during the year of which twelve came from the U.S.A. two from Britain and eleven from other European countries. A summary of trade missions, etc. is given at appendix 11 of this report.
259. Trade missions of particular interest were an eight member trade and goodwill mission from British Columbia led by the Premier, the Hon. W. A. C. BENNETT which visited Hong Kong from 3rd to 6th June, 1965, a sixteen member Netherlands Economic Mission led by Mr. Sidney J. VAN DEN BERGH, President of the Netherlands Council for Trade Promotion which visited Hong Kong from 15th to 19th June, 1965, an official United States Trade Mission, consisting of five members
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led by Mr. Roy GOOTENBERG, Director of the Trade Missions Division of the United States Department of Commerce which arrived on 10th November, 1965 for an eleven day visit and a Zambian Trade Mission led by Mr. W. HARRINGTON Which visited Hong Kong from 16th to 18th February 1966.
260. Other important trade mission included a trade mission from the State of Washington, a delegation from the Johannesburg Chamber of Commerce and a Chicago trade mission, all of which arrived in May 1965, a sixty member trade mission from Illinois in November 1965, a twenty one member delegation from the Turin Chamber of Commerce in February 1966 and a large trade mission from Iowa which arrived in March 1966.
261. In addition, important visitors included Mr. G. R. GOUDE, Secretary of the British Toy Manufacturers Association who visited Hong Kong from the 8th to 15th November 1965 at the invitation of local plastic toy manufacturers and Mr. Andrew MUTEMBA, Resident Minister of the Western Province of Zambia who visited Hong Kong from the 14th to 17th December, 1965 at the invitation of the Public Relations Joint Committee of the Hong Kong General Chamber of Commerce and the Federation of Hong Kong Industries.
TRADE COMPLAINTS
262. The continued increase in trade and the number of visitors to Hong Kong was again reflected in the number of trade complaints in which the department was asked to mediate during the year. Statistics for trade complaints are included in table 4 to this report.
263. A total of 744 trade complaints were received from overseas firms or individuals compared with 609 during the previous year. The largest single categories of overseas trade complaints again related to non delivery and outstanding debts. Over 80% of all complaints received were amicably settled after intervention by the department.
264. Fifty four local firms sought the department's assistance in obtaining settlement of their claims with overseas countries.
VIII. TRADE PUBLICATIONS BRANCH
TRADE BULLETIN
265. The aims of the monthly Trade Bulletin include overseas pro- motion of Hong Kong products; projection of a favourable image of
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Hong Kong's economy; publication of Hong Kong's service industries so as to assist in interesting overseas businessmen in the possibilities of setting up manufacturing operations in Hong Kong. The part which it plays in promoting Hong Kong trade is reflected in the increased corre- spondence received during the year from overseas firms and businessmen wishing to receive the publication. The mailing list now stands at 19,000. As a result, circulation at the end of March 1966 was in the region of 22,850 copies a month. While the majority of these are sent free of charge to overseas firms and businessmen interested in trading with Hong Kong, domestic subscriptions and sales have also continued to increase.
266. The overseas trade enquiries section, which appears as a supple- ment to the local edition of the Trade Bulletin, is well patronized by over- seas businessmen and over 1,700 enquiries were published during the year, bringing in a total of $17,888 for the year.
267. Regular feature articles continued to emphasize Hong Kong products' quality and high standards of workmanship and to introduce new products to overseas buyers. Two regular features continued during the year. One, on service industries, consisted of articles contributed by Hong Kong businessmen and other people well-known in commercial circles and dealt with those industries whose invisible earning helped to redress the imbalance in Hong Kong's visible trade. The 'Bulletin Note- book' series provided information on visits of overseas businessmen and delegations of potential commercial importance which it had not been possible, owing to limited space available, to cover in full length. The Bulletin Notebook also contained items of domestic news considered of interest to overseas readers.
268. The demand for space in the Bulletin for black and white adver- tisements was such that all available space was fully booked several issues ahead of printing. The average revenue from advertisements during the year was $40,790 an issue, compared with $33,360 for the last year.
269. The Department wishes to acknowledge the help given by the Information Services Department, commercial studios and photographers who have provided photographs throughout the year, often at very short notice. In addition the technical advice and co-operation of the two printers have been invaluable.
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IX. OVERSEAS OFFICES
LONDON OFFICE
General and Office Accommodation
270.
Throughout the year the work of the London Office expanded steadily. The first few months were largely occupied with preparations for the opening of the new trade promotion centre at 55-58, Pall Mall. This took place on 19th July, 1965, when a prestige display of Hong Kong products was transferred from inside the original office premises at 54, Pall Mall to the large show window next door.
271. The additional office space not only provided a more spacious reception area to deal with enquirers but also made it possible for the Information Section with its library to move into more suitable accommo- dation. In addition the Hong Kong Students Unit was able to transfer from Hong Kong House, thus bringing together all the Government agencies in London.
272. Concurrently steps were taken to reorganize the internal office administration and to bring the accounting system into closer relation with that operating in Hong Kong.
273. Later in the year as a result of recommendations made by a Working Committee on Export Promotion Organization, Government decided that a new autonomous Trade Development Office should be set up from April 1966. (See paras. 27-30). In conformity with this decision a Trade Development Office is to be set up in London and will in due course take over the 55/58, Pall Mall premises. During the latter part of the year the staff was engaged in planning the necessary separation of staff, functions and accommodation.
Trade Relations
274. The importance of the Office in the field of international nego- tiations affecting Hong Kong trade continued undiminished.
275. Many visits were paid to the Office during the year by both official and unofficial representatives of the Colony and the use of the flat proved invaluable as an office and conference room with full secretarial facilities. These services were used by His Excellency the Governor during his visit to London in October 1965 in connexion with the cotton textiles carry-over problem. They were also used on a number of occasions by officers of the Department during visits to London or en route to Europe or America for trade negotiations.
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276. Continuous contact was maintained with the Board of Trade in connexion with arrangements to regulate cotton textile shipments from Hong Kong to the United Kingdom after the expiry of the 1963-1965 agreement. The office was represented at a series of preliminary talks in London on both the substantive and interim arrangements and the Director accompanied a Board of Trade delegation and a Colonial Office representative to Hong Kong in February 1966 for full scale negotiations.
Trade and Industrial Promotion and Public Relations
277. Many discussions were held with United Kingdom manufac- turers on the possibilities of establishing joint manufacturing ventures in the Colony. Where company representatives were subsequently sent out to the Colony to investigate these possibilities more fully, letters of intro- duction were provided. Relevant information and letters of introduction were also given to British businessmen going out to the Colony. Assistance was given to a party from the London Chamber of Commerce which was made up largely of importers of Hong Kong products when they visited Hong Kong in connexion with the British week. The office also assisted the British National Export Council's Committee for Exports To Asia which organized an inward mission, bringing to London rep- resentatives from Hong Kong stores on a seeing and buying mission.
278. Trade enquiries during the year numbered 5,480 as compared with about six thousand in 1964–65.
279. There was a marked increase in the number of claims to Pref- erence. During the year, 5,057 (2,766) letters were written by H.M. Customs and Excise to Hong Kong Accountants which were copied to the London Office for information.
280. A new procedure for handling trade complaints was introduced as a result of which the Office corresponded direct with the Federation of Hong Kong Industries and the Hong Kong General Chamber of Commerce on complaints involving their members. 40 complaints by British firms against Hong Kong firms and three by Hong Kong suppliers against importers in Britain were investigated.
281. The office was represented at eight meetings of the Hong Kong Association. Representatives of the Office served on a special sub- committee of the Hong Kong Association to plan the utilization of the Trade Centre in the basement of 55-58, Pall Mall, which was sublet to the Joint Public Relations Committee. Every assistance was given by the
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Office to Messrs. Campbell-Johnson Ltd. who acted for the Joint Public Relations Committee in the planning of the 'Hong Kong Buys British' exhibition held to coincide with British Week in Hong Kong.
282. Towards the end of 1965 vigorous action was taken by the Office to combat an outbreak of adverse publicity for Hong Kong products, including plastic ice coolers, plastic toys and Christmas tree decoration lights. Close liaison was maintained throughout the year with the Home Office on health and safety factors affecting these and other Hong Kong products.
283. The Information Section acted as intermediary between Hong Kong Government departments and the organizers of the Commonwealth Arts Festival in connexion with the Colony's representation. The foyer of the National Film Theatre in London was specially decorated for the premiere of the Colony's entry 'The Vermilion Door' and a reception was arranged at which the guests of honour were Sir Robert and Lady BLACK.
284. Window displays at 54, Pall Mall during the year were devoted to the following subjects:
Port of Hong Kong
Hong Kong Fire Services
Ocean Terminal
Employment in Hong Kong
During British Week in Hong Kong a special window display was pro- vided by the Central Office of Information.
285. Considerable assistance was given during the year to a number of newspapers and magazines which published special supplements on Hong Kong. These included The Times, The Scotsman, The Guardian, Sheffield Telegraph, Glasgow Herald, Ambassadow and The Statist. In connexion with the supplement in The Guardian a photographic display to illustrate the theme 'Hong Kong at Work' was arranged for display in the window of the newspaper's head office in Manchester.
286. Press releases on a wide variety of topics were compiled from information received from Government Information Services and were distributed to newspapers, magazines and news agencies. Nearly 200 such press releases were issued during the year. Distribution of this material is the basis of a continuing effort to keep the British public
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informed about Hong Kong and its achievements. It resulted in prom- inently displayed articles in newspapers and magazines covering a very wide range of subjects.
287. Sixteen British Press Surveys, a digest of what the British press had been saying about Hong Kong, were issued. This survey is sent to some 150 organizations and businessmen in the United Kingdom and is also redistributed by the Information Services Department to interested parties in the Colony. It also provides material for inclusion in a monthly programme produced by the B.B.C. for Radio Hong Kong.
288. The Information Section runs a small film library from which loans are made to schools, clubs and other private audiences. The number of films loaned during the year was 196. Sets of colour slides with lecture notes were loaned 60 times. It also has a stock of several thousand black-and-white photographs and colour transparencies, and subjects are regularly brought up-to-date by the Information Services Department. These photographs were in constant demand for reproduction by news- papers, magazines and publishing houses, as well as by authors, freelance journalists, lecturers and commercial publicity agencies and broadcasting organizations.
Visitors
289. With the extension of the Office to the basement and ground floor of 55-58, Pall Mall and a larger display of Hong Kong products in the new premises, the number of visitors increased greatly, bringing the total for the year to 6,249 as compared with 4,000 in the previous year. On the recommendation of Chambers of Commerce and other interested organizations throughout the British Isles, more businessmen have come to London solely to see the display of Hong Kong products and to discuss ways of increasing their own turn-over by importing goods from Hong Kong.
Hong Kong House
290. The Office continued to assist in the administration of Hong Kong House. Much time was devoted to problems which arose during the year mainly as a result of staff changes, illness and in particular, rising catering and associated costs. One meeting of the Board of Governors and three meetings of the Executive Committee were held during the year. Frequent meetings took place between the Assistant Director, the Warden and the Deputy Warden on routine matters connected with the running of the House.
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THE SYDNEY OFFICE
General
291. Interest in the Colony, on the part of Australian importers and retailers, as a source of supply for finished consumer products, semi- finished goods and ancillary industrial materials and components con- tinued to grow. Exports to Australia during 1965 increased in value by 18% over 1964 figures, re-exports by 32% and imports from Australia into Hong Kong fell by 13%. Garments, particularly woollen knitwear, cotton piecegoods, bleached, unbleached and loom state, printed cottons and toys accounted for the main increases in exports from Hong Kong.
292. The department was kept advised of developments in the economic and commercial spheres, on Australian importing policy and on Tariff Board matters. Liaison was maintained with Chambers of Commerce and other representative organizations throughout Australia and with the Departments of Trade and Customs & Excise.
293. The representative visited Melbourne, Brisbane and Canberra on a number of occasions, attended the annual conference in Brisbane of the Associated Chambers of Commerce of Australia in his official capacity and paid a duty visit to Hong Kong for two weeks in January. In February 1966, in company with a trade consultant retained by the Hongkong General Chamber of Commerce and the Federation of Hong Kong Industries, he visited Wellington, Auckland and Christchurch to carry out a survey of the Colony's trade prospects with New Zealand.
Trade Enquiries, etc.
294. 672 trade enquiries covering a wide range of products were dealt with by the Sydney Office and 87 Australian businessmen intending to visit the Colony were given advice and information and letters of introduction where necessary. Assistance was rendered to 209 Hong Kong merchants seeking entry into the Australian market.
295. Thirty-six complaints against Hong Kong firms were investigated; most of these concerned failure to reply to correspondence or to ship goods as ordered or according to sample. With the assistance of the department a satisfactory settlement was achieved in the majority of these cases. Assistance was given to 8 Hong Kong merchants in obtaining settlement in complaints against Australian importers. These mainly were concerned with non-payment for goods ordered.
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Sydney Trade Fair
296. Participation in the 3rd Sydney International Trade Fair in October was the main promotional activity during the year. (See para. 231).
Publications and Public Relations
297. In July the Sydney Morning Herald published a special survey on Hong Kong's trade with Australia and in October the Australian Financial Review issued a similar supplement. Hong Kong was also featured in supplements in connexion with the Sydney Trade Fair published by the Sydney Morning Herald and the Sydney Daily Telegraph. Advertisements were inserted by Information Services Department in these periodicals and in two New Zealand newspapers, publicizing Hong Kong, the Hong Kong participation in the Sydney Trade Fair and the services available from the Sydney Office.
298. There was continued demand for Hong Kong publications particularly the Commerce, Industry and Finance Directory and the Trade Bulletin. Four hundred and ninety names were added to the mailing list for the Trade Bulletin and at the end of the year over 2,500 Australian addressees were receiving this publication regularly.
299. Talks on the Colony, usually accompanied by the screening of a Hong Kong film, were given by the representative to a variety of audien- ces. The demand from teachers and students for school project material on the Colony continued unabated and literature, posters, photographs, slides, films and display material were issued or loaned in response to many requests for such media. A constantly growing number of general enquiries on all aspects of the Colony was dealt with.
BRUSSELS OFFICE
300. Mr, J. H. MARTIN, Assistant Director, established the depart- ment's office in Brussels on 1st June 1965 working initially from a hotel but later from a flat rented on his behalf. He was accredited to the Belgian Government as a number of Her Majesty's Embassy with the rank and style of Counsellor (Hong Kong Commercial Affairs). An office in Britannia House, 30 Rue Joseph II, Brussels 4, was opened on 4th October. This building is also now occupied by the British Embassy although the Hong Kong Office is separate.
301. The latter part of 1965 was primarily devoted to establishing the office and to making appropriate contacts with officials of the European
64
Economic Community secretariat, of the various Embassies and of Government offices in Brussels. However the Assistant Director accom- panied the Assistant Director Textiles and Certification, to Bonn for meetings with officials of the West German Ministry of Economic Affairs to discuss imports of woollen knitted outerwear in October. He also accompanied the Financial Secretary and the Director London Office on a visit to Paris in November to meet officials of the Ministry of Finance and Economics.
302. A Trade Officer from Hong Kong joined the staff in November. At the end of the year the staff of the office consisted of the Assistant Director, a Trade Officer, two secretaries and a clerk.
X. TRADE LICENSING AND SUPPLIES BRANCH
TRADE LICENSING
303. The Importation (Prohibition) (Strategic Commodities) Regula- tions 1959 and the Exportation (Prohibition) (Strategic Commodities) Regulations 1959 were revoked, and replaced by the Importation and Exportation (Strategic Commodities) Regulations 1965 on 21st December, 1965. The object of these new regulations was to revise the list of strategic commodities which can be imported or exported under licence, so as to conform with the list now in force in the United Kingdom.
304. In line with the United Kingdom Government's policy on Southern Rhodesia after the latter's Unilateral Declaration of Independ- ence, the importation of unmanufactured tobacco grown in Southern Rhodesia was subjected to licensing control under the Importation (Southern Rhodesia Tobacco) Regulations 1965, which came into opera- tion on 14th December, 1965.
305. As a result of Hong Kong's participation in the International Coffee Agreement, it became necessary to control the import and re-export of coffee under the Importation (Coffee) Regulations 1966, which were promulgated and brought into effect on 25th March, 1966. Under these new regulations, imports of coffee are subjected to licensing control, whilst re-exports of coffee must be covered by re-export certificates issued by recognized authorities in order to facilitate their entry into countries which participate in the International Coffee Agreement. In August 1965, the International Coffee Council directed that, although restrictions on imports from non-members under the provisions of the International Coffee Agreement should not be imposed at once, members
65
were to make immediate preparations so as to be able to implement controls without delay when called upon to do so. As these restrictions applied to Hong Kong's coffee re-exports to member countries, it was necessary to participate in the International Coffee Agreement in order to guard against any disruption of this substantial re-export trade which amounted to $15.7 million and $41.4 million in 1963 and 1964 re- spectively.
306. Following similar measures imposed by the United Kingdom Government, controls were introduced on exports of arms and military equipment to India, Pakistan and Southern Rhodesia during the last quarter of 1965. Controls on such exports to India and Pakistan were terminated in March 1966. Throughout the year under review, controls continued to be exercised on strategic commodities intended for export to Indonesia.
307. The number of import licences issued for all purposes, including controls on strategic goods, reserved commodities (e.g. rice) and in respect of currency and health regulations, was 23,117 (20,602*).
308. 122 (92) delivery verification certificates were issued to confirm the arrival in Hong Kong of highly strategic goods.
309. Most of the export licences issued by the Licensing Section are for exchange control purposes. Total licences issued (excluding a large proportion of textile licences processed in the Textiles Division) numbered 378,335 (457,420). As from April 1965, the processing of export licences for certain cotton, woollen and mixed cotton textile goods to Europe and America, previously handled by this Branch, was transferred to the Textiles and Certification Division, accounting for the decrease in the number of export licences issued as compared with that for 1964–65.
310. Licences covering exports of highly strategic goods require the production of delivery verification and/or landing certificates issued by the authorities of importing countries; 1,137 (582) were supplied by exporters during the year.
SUPPLIES
311. Certain essential food and fuel supplies are subject to licensing and to a limited degree of control under the Importation and Exportation (Reserved Commodities) Regulations, 1954, administration of which is undertaken by the Branch.
* Last year's figure is shown in brackets.
66
Rice
312. There was no change in the Rice Control Scheme administered under the Importation and Exportation (Reserved Commodities) Regula- tions, 1954, during 1965. The basic quarterly import quota remained at 88,000 metric tons and the stock-holding commitments at 44,000 metric tons. The working stock level ranged from 61,000-82,000 metric tons at any one time.
313. Total rice imports during the year were 345,011 metric tons (348,727), from the following sources:
Source
Thailand
China ... Cambodia
N. Vietnam
Australia
Pakistan
Burma
S. Vietnam
...
...
Jan.-Dec., 1964
Jan.-Dec., 1965
M/Tons %
M/Tons %
...
1
199,027
57.7
195,597
56.1
88,204
25.6
83,462 23.9
53,140
15.4
48,817
14.0
...
2,619
0.8
...
10,708
3.1
...
...
...
1,000
0.3
1,704
0.5
522
0.1
1,477
0.4
299
0.1
:.
200
...
6,962
2.0
345,011 100.0 348,727 100.0
Thailand, China and Cambodia further increased their respective share of the market.
314. The first half of the year, April - June, saw a disruptive dispute between the registered rice importers/stockholders and whole-salers on the one hand, and the retailers on the other. The Department was obliged to intervene and, after protracted negotiations, a settlement among the three parties concerned was eventually arrived at in June. The wholesalers abandoned a sales quota system they had introduced some months previously, and reduced the commission payable by retailers from $1.50 a picul to 80 cents. Importers also agreed to sell direct to retailers, on condition that they should first liquidate any debts owing to the whole- salers. A mutually satisfactory system of ensuring that debts had been cleared before direct sales commenced was evolved by the Department with the co-operation of all concerned.
315. There were significant increases of rice prices during July – September, characterized by an abnormal rise in the Bangkok market prices. It is usual at this time of the year to have such a seasonal rise of prices in Bangkok, prior to the harvest of the new crop around October
67
and November. However, the rise this year was much higher than in previous years, because of uncertainty about the late 1965 harvest due to the delayed arrival of the rains. This led to the imposition of quota restrictions on commercial rice exports by the Thai Government and Bangkok prices began to stabilize at the end of September. The year ended with another minor upward movement of Bangkok prices.
316. After a brief respite of about 12 months, rice price in Bangkok began to rise again in February, 1966. The main contributing factors were the drop in Thailand's exportable surplus from 1.8 million metric tons in 1965 to an estimated 1.3 million metric tons in 1966, resulting from the disappointing harvest of the 1965-66 new crop, and increased demands from India, Indonesia, Japan, Pakistan, South Vietnam and the Philippines. Food shortages in India and Pakistan, and the unsettled political situation in Indonesia and South Vietnam led to heavier pur- chases by these countries, whilst new requirements from Japan and Philippines put a further strain on Thailand's reduced supplies. Imports from Cambodia, which in 1965 supplied over 15% of Hong Kong's rice imports, declined in 1966, after a switch in its marketing arrangements to a state-trading pattern. The result of the rising trend of Bangkok rice prices was a further increase in local wholesale prices for all grades.
317. Offtakes from stocks of imported rice dropped slightly by 4,860 metric tons, as compared with 1964:
Jan.-Dec., 1965 M/Tons
Type
%
Jan.-Dec., 1964 M/Tons %
Whole Rice...
Thai origin
115,986
32.4
141,445 38.9
Chinese origin
...
89,810
25.0
81,439
22.4
Other origin
49,961
13.9
62,722
17.3
255,757
71.3
285,604
78.6
Broken Rice-
Thai origin
74,468
20.8
46,258
12.7
Low Grade and Other Rice
for Industrial Use/Poultry
Feeds-
Thai origin
Cambodian origin
Other origin
...
7,138
2.0
5,442
1.5
9,902
2.8
9,712
2.7
534
0.1
4,315
1.2
17,574
4.9
19,469
5.4
68
Glutinous Rice-
Thai origin
9,263
2.6
10,947
3.0
Chinese origin
397
0.1
Other origin
1,075
0.3
1,116
0.3
10,735
3.0
12,063
3.3
Total Offtakes:
358,534 100.0
363,394 100.0
Frozen Meat
318. Imports of Frozen meat, under licence but not otherwise con- trolled, amounted in 1965-66 to 24,154 (19,665) long tons. 84.3% of imports came from China, which is also the most important source of fresh meat. U.S.A. and Australia are the only other significant suppliers of frozen meat.
319. Consumption of frozen and fresh meat during the past three years has been as follows:
Fresh Meat
Frozen Meat
1963-64
1964-65
1965-66
(L/Tons)
(L/Tons)
(L/Tons)
90,901
101,757
106,948
14,644
19,945
24,046
105,545
121,702
130,994
Coal and Firewood
320. Total imports of coal for 1965-66 amounted to 157,316 (169,939) long tons. China, the main supplier, had 67.1% of the total market whilst Australia accounted for 25.2%. Imports of firewood amounted to 16,191 (30,151) long tons, 68.9% of which was from China. Consump- tion of coal and firewood as fuels for cooking and heating continued to drop during 1965–66.
Corned Beef
321. Arrangements were in hand to dispose of the remainder of Government's stock of corned beef (4,614 tins). After this no further Government stocks of food will be held.
XI. DUTIABLE COMMODITIES BRANCH
REVENUE FROM EXCISE DUTIES
322. The total net revenue from duties and licence fees during the financial year 1965-66 was $263,132,130, an increase of 1.7% (13.4%) over the previous financial year's $258,821,767.
69
323. Comparisons with previous years are summarized to the nearest thousand dollars in the table below:
Tobacco
Hydrocarbon Oils
Liquor
Table Waters
Methyl Alcohol
$'000
1963-64
1964-65
1965-66
93,314
101,184
93,684
65,227
75,816
82,391
...
61,506
71,843
77,019
5,414
6,328
6,244
33
54
40
225,494
255,225
259,378
A full breakdown of gross collections, together with refunds and drawback payments is recorded in Table 6.
Tobacco
324. Net duty collected from tobacco, the principal source of excise revenue, amounted of $93,683,785, a decrease of 7.4%, and fell short of the estimate by $11.3 million. The contributory factors for the decrease
were:
(a) A substantial carry-over of speculative duty-paid tobacco leaf, released from bond prior to the 1965 Budget, was manufactured into cigarettes for export on drawback to Sabah and adversely affected the net collections, in the first few months of 1965–66; (b) The tightness of credit which prevailed throughout 1965 affected the replenishment of duty-paid tobacco leaf and cigarette stocks held by the manufacturers/importers;
(c) There were increased exports of locally-manufactured cigarettes to Sabah during the second half of 1965. Such tobacco exports on drawback of duty, without a compensating increase in duty-paid releases of tobacco leaf to replenish the manufacturers' stocks, seriously disrupted the pattern of net collections from this source; and
(d) The Public Revenue Protection (Restriction of Delivery of Tobacco) Order promulgated on 25th January, 1966 forestalled speculative withdrawals of tobacco from bond such as occured in previous
years.
Collections of $1.12 million from Chinese prepared tobacco registered a 8.5% decrease from 1964-65's $1.22 million.
70
325. Duty rates for all types of tobacco, with the exception of Chinese prepared tobacco, were increased by $2.00 per lb. on 24th February, 1966.
Hydrocarbon Oils
326. Net revenue from hydrocarbon oils amounted to $82,390,613, an increase of 8.7%. Revenue from light diesel oil used by road vehicles other than public omnibuses rose by 25.8%, attributable mainly to the increase in the number of diesel taxis and public cars.
327. Duty rates for motor spirit and for diesel oil for road vehicles, other than public omnibuses owned and operated by the China Motor Bus Co. Ltd. and by the Kowloon Motor Bus Co. (1933) Ltd. were increased by 30 cents per gallon on 24th February, 1966.
Liquor
328. Net revenue from intoxicating liquors totalled $75,132,977, an increase of 8.0%. All types of liquor, with the exception of locally manu- factured Chinese-type spirits, yielded increased revenue. Collections from imported Chinese-type spirits increased by $1,925,249 or 17.6%, contrasted with a drop by $91,407 or 0.6% for the locally manufactured counterpart. Brandy, beer and whisky also showed increases of $1,447,425 or 8.1%, $1,397,333 or 10.1% and $601,917 or 7.8% respectively.
329. The use by local distilleries of molasses spirits, to reduce produc- tion costs, resulted in decreased imports of high-strength potable alcohol from South Africa for dilution as Non-European-type spirits. This was mainly responsible for the decline in revenue by $377,828 or 16.3% from spirituous liquor other than intoxicating liquor.
Table Waters
330. The mild summer of 1965 affected the consumption of bottled soft drinks. In consequence, collections from table waters decreased by $83,547 or 1.3%, compared with 1964-65's $6,328,447.
REVENUE FROM LICENCES
331. Details of types of licences and revenue collected therefrom are recorded in Table 7, and are summarized below by dutiable commodity,
71
rather than by type of licence. Revenue from licences increased by 4.4% compared with 28.9% in the previous year.
Liquor
Tobacco
Hydrocarbon Oils
•
Table Waters
Ship and Harbour Vessel
Methyl Alcohol
...
:
1963-64
1964-65
$'000
1965-66
2,060
2,582
2,745
604
786
784
112
196
195
11
27
25
2
5
4
1
1
1
2,790
3,597
3,754
XII. PREVENTIVE SERVICE
GENERAL
332. The enforcement of the provisions of the various Ordinances listed in the Second Schedule to the Preventive Service Ordinance (No. 25 of 1963), was continued by members of the Preventive Service during the year under review, with particular emphasis being placed upon excise and anti-smuggling duties, in order to protect the revenue of the Colony. Measures to prevent narcotics smuggling were continued with the co-operation of the Narcotics Bureau of the Police.
333. Responsibility for the inspection of factories and goods for export was transferred during the year to the Textiles and Certification Branch. Owing to delays in recruiting, however, the new Branch continued to operate for most of the year with seconded Preventive Service officers.
334. All six cruising launches continued their prolonged detachment to the Police for anti-illegal immigration operations.
ORGANIZATION
335. Approval was given in August, 1965, for the creation of a super- numerary leave reserve consisting of 32 Revenue Sub-Inspectors and 13 Assistant Revenue Officers, in order to reduce the considerable backlog of leave owed to all ranks of the Service.
72
336. In the same month (August 1965) approval was also given for the following additional posts at the Kai Tak Airport:
1 Senior Revenue Inspector
2 Revenue Inspectors
18 Revenue Sub-Inspectors
Woman Revenue Sub-Inspector
1 Woman Senior Revenue Officer and
4 Women Revenue Officers.
337. In March, 1966, approval was given for the additional post of one Chief Revenue Inspector for Staff Officer duties at Headquarters.
TRAINING
338. Mr. Fred BISHOP, C.B.E., formerly Commissioner of Customs and Excise, East Africa, was appointed Training Adviser to the Preventive Service on 2nd December, 1965, and arrived in Hong Kong the following day from London. His terms of reference envisage an examination in depth of all aspects of Preventive Service training in relation to the Service's responsibilities. On completion of his basic assignment, Mr. BISHOP will be responsible for initiating the implementation of his pro- posals, after approval by the Commissioner and by Government.
339. In order to facilitate the induction training of Revenue Sub- Inspectors and Assistant Revenue Officers, residential accommodation with a total floor area of approximately 4,000 square feet, was provided in 1965 for twenty Revenue Sub-Inspector trainees and thirty rank and file.
340. Induction courses were held for twenty Revenue Sub-Inspectors, sixty-four Assistant Revenue Officers and eleven Women Assistant Revenue Officers during the year.
341. Refresher courses were held for forty-eight Assistant Revenue Officers during the year.
342. Scooter driving lessons were given to twelve Revenue Sub- Inspectors.
343. Departmental English classes were held for eighty-three rank and file, and seventy-eight of them were successful in the final examinations held by the Training and Examination Units, Colonial Secretariat.
344. During the year, twelve members of the Inspectorate attended Extra-Mural courses run by the University of Hong Kong and Chinese University of Hong Kong. Two Inspectors attended a Supervisory Studies
73
Course provided by the Hong Kong Technical College, and three Chief Inspectors attended a Personnel Administration course conducted by the Hong Kong Management Association.
345. One Chief Revenue Inspector completed a Customs Administra- tion course in New Zealand.
346. One Senior Revenue Inspector and one Revenue Inspector attended the Supervisory Management Course (Human Aspects) at Chesters, Glasgow.
347. One Senior Revenue Inspector visited oil refineries in Ellesmere Port (England) and Beirut, during his vacation leave, to study the revenue protection aspects of their operation.
348. One Revenue Inspector was awarded a merit trip to the United Kingdom. During this trip, he was attached to the H.M. Customs and Excise for practical training.
349. Two Revenue Inspectors and two Revenue Sub-Inspectors pro- ceeded to the United Kingdom in March 1966 for a study course which included practical attachments to H.M. Customs and Excise and a resi- dential course on Personnel Management at the Leicester College of Technology.
350. Two Customs Officers from Sabah were attached to the Preven- tive Service for field training.
351. Eight lectures describing the functions and operations of the Preventive Service were given to Officers of the Prison, Police and Im- migration Departments during the year.
STAFF AND DISCIPLINE
352. One Chief Revenue Inspector, five Revenue Inspectors, three acting Revenue Inspectors and thirteen Revenue Sub-Inspectors of the Preventive Service were transferred to the Industry Inspection Branch of the Commerce and Industry Department, and four Revenue Sub-Inspectors and four Assistant Revenue Officers transferred to other departments of the Government.
353. One Revenue Inspector retired, and one Revenue Officer, twelve Assistant Revenue Officers and three Women Assistant Revenue Officers resigned from the Service.
354. Two Revenue Sub-Inspectors and one Woman Assistant Revenue Officer were dismissed from the Service.
74
355. One Senior Revenue Inspector, two Revenue Inspectors, Two Revenue Officers, four Assistant Revenue Officers and one Woman Assistant Revenue Officer received commendations or favourable entries in their Record of Service files.
Punishments were awarded as follows:
356.
Cautions
...
Admonishments
Reprimands
Severe reprimands
...
Deferments of increment
1964-65
1965-66
1
...
5
7
...
6
5
2
...
•
2
5
1
1
3
Fines
...
...
Reductions in rank Dismissals
...
SEARCHES
357. Preventive Service officers searched 1,093 (1,281*) ocean-going vessels within the harbour and, in most cases, guarded them during their stay in port, while the launch crews searched 13,445 (15,606) native craft outside harbour limits for dutiable Commodities, narcotics and illegal immigrants. Waterfront search parties continued their daily searches of Macau ferries, hydrofoils and motor trading junks berthing along the Hong Kong prays and at Aberdeen.
358. Preventive Service launches steamed a total of 15,930 (13,331) hours and patrol vehicles ran a total of 207,214 (177,610) miles, of which 144,787 miles were logged by New Territories mobile patrols. At the Lo Wu Border Station, 873,391 persons passed through the baggage exami- nation hall, as compared with 637,288 in 1963-64 and 854,316 persons in 1964-65. The Hong Kong waterfront search and patrol unit processed 1,214,973 incoming passengers from Macau; the relevant figures for the past two years being 680,175 and 863,208. Preventive Service officers at the Kai Tak Airport examined 54,350 (22,816) packages of freight, of which 2,674 (3,950) pieces were detained for payment of duty. 3,345 (3,261) aircraft were checked and 447,674 (398,171) passengers were processed during the period.
359. Preventive Service officers continued their efforts to suppress the illicit use of industrial diesel oil in motor vehicles. Over 14,042 (3,600) vehicles were checked, resulting in the seizure of 3,259 (1,489) gallons of industrial diesel oil with 584 arrests.
* Last year's figure is shown in brackets.
75
360. There was no marked increase in the activities of illicit distilling this year although weather conditions became more favourable for such activities; only 227 stills were seized as compared with 224 stills recorded last year. Continuous development of hills and lowlands in both Kowloon and New Territories has reduced, the number of sites suitable for distilling activities adjacent to built-up areas. Constant patrols performed by Pre- ventive Service officers made it more difficult for illicit distillers to find places suitably remote for operation. Smaller operators were forced out of business when they found that it was unprofitable to operate from areas too remote from town, where extra labour and transportation expenses were incurred, and the risk of detection was greater. A more sophisticated and elaborate type of still, to give quicker heating and more efficient performance is now being used. This, together with time-saving methods, and the use of larger quantities of fermenting material to give higher production rates, may assist the survival of illicit distillers.
NARCOTICS
361. Preventive Service officers maintained close liaison with the Narcotics Bureau of the Police Force in the drive against narcotics smuggling. Seventy-four seizures of narcotics were made during the year.
362. The largest single seizure of drugs was made on board the oil tanker 'Hyria' which arrived from Singapore in December, 1965. During a routine search the officers of a rummaging party located 328.19 lbs. of raw opium concealed in a secret compartment behind the panelling in one of the crews' cabins.
363. Another large seizure consisted of 271.1 lbs. of raw opium which was found in a fresh water tank in the forepeak on board the s.s. 'Kowloon' which arrived from Singapore in January, 1966. Three men were arrested; two convicted and sentenced to 7 years imprisonment while one was acquitted.
364. Thirty blocks weighing 44.7 lbs. of morphine hydrochloride were found in the coal bunker buried under tons of coal on board s.s. 'Taipooloy' which arrived from Singapore in October, 1965. Officers at Kai Tak Airport found five pounds of raw opium concealed in a false com- partment in the suitcase of a passenger who arrived from Bangkok. He was subsequently sentenced to 12 months' imprisonment.
76
BULLION
365. Gold seizures totalled 348.32 lbs. (431 lbs.) valued at $1,192,000. The seizures, five in all, were made at Kai Tak Airport. The methods adopted by the smugglers were all similar; the gold bars being carried in specially made under-vests worn on their bodies.
366. A Lebanese man arriving from Tokyo by air was found carrying 38 kilogramme bars of gold in July, 1965, while another Lebanese male also arriving from Japan was discovered bringing in 40 kilogramme bars of gold in January, 1966. The third carrier, an Englishman, imported 30 kilogramme bars of gold from Bangkok in February, 1966. All three persons were convicted and sentenced to 6 months' imprisonment. In March, 1966, two Indians, father and son, arriving from Bangkok were found to be carrying 28 and 22 kilogramme bars of gold respectively. The outcome of these two cases is pending.
EMERGENCY (AGRICULTURAL POISONS) REGULATIONS
367. One infringement of these regulations during the year was dis- covered by Preventive Service officers stationed in the New Territories and 2,500 c.c. of Folidol were seized. One person was arrested and a fine of $300 was imposed.
COURT ACTIONS
368. The number of court actions for the year was 3,691, a significant increase of 1,125 over the previous year. 1,339 arrests were made, an increase of 139 on last year's figure.
369. The following table illustrates the trends over the last three years:
Actions Arrests
***
•
Fines
...
1963-64
1,990
1964-65
2,566
856
1,200
1965-66
3,691
1,339
$206,552 $212,036 $159,477
Details of major confiscations ordered by Courts are given in Table 8 and of dutiable Commodities and dangerous drugs in Table 9.
XIII. STATISTICS BRANCH
GENERAL
370. The Statistics Branch is responsible for collecting, compiling and tabulating the Colony's trade statistics; for collecting price information
77
and calculating the Consumer Price Index; for editing and publishing the monthly Statistical Supplement to the Government Gazette; for managing a punched-card data processing installation, and for supplying statistical information and advice to other branches of this Department, to other departments and to a large number of outside concerns.
TRADE STATISTICS
Classification
371. A number of amendments, effective from January 1966, was made to the 1965 edition of the Hong Kong Imports and Exports Classi- fication List. At the same time the index of commodity items in the published Trade Statistics was revised so as to agree with these changes. The amendments mainly relate to clothing items made wholly or mainly of synthetic fibres, which are now classified separately on account of their growing importance. A separate list of amendments was printed for the benefit of the holders of the 1965 edition of the Classification List. To facilitate comparisons of the trade statistics over the years, a list was prepared reconciling the code numbers of commodity items included in the current Classification List with those in force in the previous years since 1959.
Trade Declarations
372. A total of 947,575 (973,513*) import, export and re-export declarations was received during the year. Of the above total, 67,734 (65,475) declarations were collected through the Kowloon Office of the Department. Classified by type of declarations, the figures are as follows:
Imports Exports
Re-exports
1964-65
1965-66
427,532
412,691
...
426,627
421,225
119,354
113,659
373. Some importers and exporters failed to submit their declarations within the prescribed time limit and this resulted in a total of 115,496 (129,086) reminders being sent during the year. Queries about incorrect details given on declarations and cargo manifests totalled 50,093 (54,986).
* Last year's figure is shown in brackets.
78
374. Details of revenue collected for the services provided by the Branch during the year ending 31st March, 1966 with comparative figures for the previous year, are shown below.
Stamp duty on declarations
Fees for landing certificates
1965-66
1964-65
$
$
•
1,881,588
1,947,026
9,060
12,490
9,945
8,813
...
3,730
3,510
Total
...
...
1,904,323
1,971,839
Fees for statistical information
Fees for endorsements
375. Requests for special statistics continued to be received in the Trade Statistics Section as well as enquiries about Hong Kong's trade in certain commodities or with certain countries, about classification numbers and about the published statistics. The number of personal enquiries received by the section during the year was approximately 6,800 and in addition 1,000 written enquiries were received of which about 20% related to unpublished information.
376. Ships' cargo manifests received during 1965–66 numbered 51,785 (48,989).
Parcel Post Statistics
377. The present method of collecting parcel post statistics is that merchants are requested to complete voluntarily each month a return on a simple form indicating the total number and total value of packages they have imported or exported through the post during the previous month; only commercial transactions are required. Although efforts were again made during the year to encourage merchants to complete these returns, the response rate is still low as is shown by a comparison of the records kept in this office with the recorded total number of parcels exported and imported through the Post Office. A total of 535 (577) returns was received during 1965–66. The number and value of parcels declared were as follows:
Despatched:
Number of parcels
...
1965-66
4,497
1964-65
5,502
Value ...
Received:
Number of parcels
Value ...
...
...
...
...
...
79
$ 6,814,303 $ 4,482,864
12,550
15,520
$12,813,062 $11,015,876
Section of Commodity/Service
378. Where merchants, through usage or convenience, continue to record their postal transactions on import and export declaration forms, these are included in the Trade Statistics under the appropriate commodity and country classifications. There is no classification of parcel post items into exports and re-exports, and parcels despatched are recorded in the trade statistics as exports.
CONSUMER PRICE INDEX
379. The Consumer Price Index figures are ready within the first ten days of the month following the month to which they refer; they are published at the end of the month in Special Supplement No. 4 to the Government Gazette. The figures for September 1964 to May 1965 were published together in June 1965 and since that time the monthly figures have been published regularly. Since September 1965 onward a moving twelve monthly average figure has also been published, which helps to smooth out seasonal movements and shows the underlying trend of price movements in comparison with the base period, whereas the unadjusted monthly figures include the full effects of seasonal fluctuations.
380. Movements of the Consumer Price Index:
CONSUMER PRICE INDEX FIGURES FOR EACH MONTH FROM
SEPTEMBER 1964 to March 1966
(1963–64
100)
Weights
attached
Sept. 1964
Oct. 1964
Nov. 1964
Dec. 1964
Jan. 1965
Feb. 1965
Mar. 1965
Apr. 1965
May 1965
June 1965
July 1965
Aug. 1965
I. Foodstuffs
II. Housing ...
III. Fuel and light
IV. Alcoholic drink and tobacco
V. Clothing and foot-
wear
VI. Durable goods VII. Miscellaneous
goods
VIII. Transport and
vehicles
IX. Services
-
All Items
48.3 118 112 104 97 98 101 101 101 102 102 105 105 106|110|107104 104 105 105 15.2 100 100 100 100 100 100 100 100 100 100 102 102 102 102 102 102 102 102 102
3.0 100 100 101 101 101 101 101101 101 101 99 99 99 99 99 99 99 99 99
3.3 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 104
6.2 100 100 100 100 101 2.1 100 99 99 99 99
99101 101 101 101|101 101|101|101| 99 98 99 99 98 99 99 101 101101 101 101 102 100 100 100 100 101 101
4.2 100 100 100 100 100 100 100 100 100 100 100 99 100 100 100 100 101 101|101
3.2 100 100 100 100 100 100 100 100|100|100|100,100 100 100 100 100 100 100 101 14.5 100 100 100 100 101 100 100 100 100 100 101|100|102|102 102′102 103 103 103
01 101103
100.0 109 106102 99 99 100 101 101 101|101|103 103 104 105 104 102 103 103 103 103 103 103
80
Sept. 1965
Oct. 1965
Nov. 1965
Dec. 1965
Jan. 1966
Feb. 1966
Mar. 1966
381. Over the period under review the Consumer Price Index showed a slowly rising trend which took it from 101 in April 1965 to 103 in March 1966 with a peak of 105 in October 1965. Movements in the index mainly originated in the movements of prices of foodstuffs such as rice, fish, meat and especially of vegetables, but changes also took place in the index for housing (higher water charges) and for services (higher school fees).
382. A Modified Consumer Price Index has also been calculated, using the same price data as for the General Consumer Price Index but based on the weights derived from the expenditure of households spending less than $600 a month in the Household Expenditure Survey, 1963–64. This Modified Consumer Price Index is used for the purpose of calculating a variable cost of living allowance for minor staff (Scale 1) in Government employment.
383. Movements of the Modified Consumer Price Index:
MODIFIED CONSUMER PRICE INDEX FIGURES FOR EACH MONTH FROM
SEPTEMBER 1964 TO MARCH 1966 (1963-64
=
100)
Section of Commodity/Service
Weights
attached
Sept. 1964
Oct. 1964
Nov. 1964
Dec. 1964
Jan. 1965
Feb. 1965
Mar. 1965
Apr. 1965
May 1965
June 1965
July 1965
Aug. 1965
Sept. 1965
Oct. 1965
Nov. 1965
Dec. 1965
Jan. 1966
Feb. 1966
Mar. 1966
I. Foodstuffs
II. Housing ...
III. Fuel and light
IV. Alcoholic drink and tobacco
V. Clothing and
footwear...
VI. Durable goods
VII. Miscellaneous
goods
VIII. Transport and
vehicles
IX. Services
+
55.6119 113 104 97 97 101 100 101 102 102105 105 107 111 107 104 104 105 105
... 12.9 100 100 100 100 100 100 100 100 100 100 102 102 102 102 102 102 102 102 102
3.0 100 101 101 101|102 102 102 101 101 101 100 100 100 100 100 100 100 100 100
4.2 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 104
4.9 100 100 100 100 101 99101101 101 101,101 101 101 101 99 99 99 99 98
1.5 100 99 99 99 99 99 99 101 101 101 101 101 102 101 101 100 101 102 102
4.1 100 100 100 100 100 100 100 99 100 100 100 99 100 100 100 100 101 101 101
2.8 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100
11.0 100 100 100 100 101 100 100 100 100 100 100 100 102 102 102 102 104 103 103
All Items
100.0 111 107 102 98 99 101 100 101 101 101 103 103 104 107 104 103 103 103 104
81
RETAIL PRICE INDEX
384. The retail price index was calculated and published monthly. The figures for the end of each quarter on the basis of March 1947=100 were as follows:
June Sept. Dec. Mar.
1965
1965
1965 1966
Food
132
134
142
138
Rent
119
119
119
119
Clothing, including footwear
112
113
114
114
Fuel
109
112
107
112
Electric light ...
56
55
55
54
Cleaning
95
94
96
96
...
Education
140
140
140
140
Tobacco and cigarettes
124
124
124
134
Doctor and medicines
104
104
104
105
Fares
100
100
100
100
...
...
Household equipment
Hairdressing...
Newspapers and stationery
Shoe repairs
...
128
127
128
129
141
141
141
141
•
153
153
153
153
104
104
104
104
...
Rates ...
100
100
100
100
...
125
126
131
129
General Retail Price Index ...
385. The average for the year of the general retail price index was 128, a rise of one point from the average for the previous year. There was a peak of 132 in November 1965 and the lowest index during the year stood at 125 in April, June and July 1965. The index at 130, 132, and 131 for October, November and December respectively was occasioned by high prices of foodstuffs as an aftermath of typhoons. Price movements during other months were considered normal. Now that a new Consumer Price Index has come into existence, it is probable that the calculation of the existing Retail Price Index will soon be discontinued.
WORK FOR 1965 SALARIES COMMISSION
386. The Statistics Branch undertook the processing and analysis of the results of expenditure enquiries carried out in February 1965 by the civil servants' staff associations, covering 178 European and 42 Chinese civil servants' households. The schedules, daily expenditure records and estimates of annual expenditure were written up by the co-operating households without the assistance of this Department's survey interviewing officers. The tabulated results and analysis were completed in May 1965.
82
387. A small exercise was also conducted for the Salaries Commission to find out the average number of children under 14 in each household which participated in the 1963-64 Household Expenditure Survey.
CONTINUOUS HOUSEHOLD EXPENDITURE SURVEYS
388. A series of monthly surveys was continued on a routine basis as from July 1965. For the purpose of securing households to participate in the surveys, some 2,000 households were selected from the 1961 Census records by means of simple random sampling in the same way as for the 1963-64 large scale expenditure survey. This method of selection ensures that each household has an equal chance of being chosen and that a high degree of representativeness is achieved. Preliminary visits were made in the last two weeks of June 1965 and again from late February to mid-March 1966, the first attempt succeeding in securing 503 bouse- holds out of 811 visited and the second 388 out of 476, a response rate of 63% and 82% respectively. During the preliminary enquiry, each selected household was informed in advance of the forthcoming visit of a survey interviewing officer.
389. Up to March 1966 a total of 479 households consisting of 2,622 persons participated in the Survey, and the following are the results in comparison with the expenditure pattern obtained in the main survey conducted from September 1963 to August 1964:
Section of commodity/service
I. Foodstuffs
II. Housing...
III. Fuel and light
•
...
Main Survey 1963-64 ($100-$1,999)
Continuous Surveys
July 1965— Difference March 1966 ($100-$1,999)
―
%
0.7
+0.7
%
%
46.0
45.3
· 14.5
15.2
2.8
2.6
0.2
...
IV. Alcoholic drink and tobacco
V. Clothing and footwear
VI. Durable goods...
VII. Miscellaneous goods
VIII. Transport and vehicles
3.1
3.0
- 0.1
5.9
5.3
- 0.6
2.0
1.6
- 0.4
4.0
3.8
0.2
3.1
3.4
...
+ 0.3
IX. Services
13.8
...
13.7
- 0.1
X. Non-consumption payments
4.7
6.1
...
+1.4
100.0
100.0
83
390. The object of these continuous monthly surveys is to keep under review the weights and commodities used in the construction of the Consumer Price Indexes and to adjust them if a significantly different and lasting pattern takes shape.
TEXTILE PRODUCTION STATISTICS
391. Quarterly returns were collected from spinning and weaving mills registered with the Department. The production figures of cotton yarn, cotton fabrics and woollen yarn are given below:
1963 1964
...
1965
...
1965 1st quarter
2nd quarter.
3rd quarter
4th quarter
...
Cotton yarn Cotton fabrics
(mn. lbs.)
Woollen yarn
(mn. sq. yds.)
(mn. lbs.)
240.55
568.41
11.28
260.91
579.19
12.26
...
288.89
649.85
17.44
68.07
154.84
3.68
73.55
161.27
4.76
71.83
160.18
4.72
75.44
173.56
4.27
392. The number of cotton spindles, cotton looms and wool spindles has increased considerably during the past three years, as shown below:
End of year
1963
1964
1965
...
Cotton spindles
632,912
715,500
724,722
Cotton looms
19,872
20,709
21,198
Wool spindles
29,776
32,680
35,422
393. Retained imports of raw cotton, cotton yarn and wool tops during the years 1963 to 1965 are as follows:
1963
1964
...
1965
Raw cotton (mn. lbs.)
Cotton yarn
Wool tops
(mn. lbs.)
(mn. lbs.)
270.70
25.32
10.58
...
287.06
31.82
12.83
292.14
21.30
14.61
RESEARCH
394. The work of the newly created Research Section continued to expand during the year. In addition to routine duties of preparing statis- tical tables for Departmental monthly reports, providing statistical infor- mation for trade missions and negotiations, answering questionnaires from the U.N.O. and its specialized agencies, and collating basic economic
84
data, the Section is committed to a monthly compilation of a series of short-term economic indicators. A preliminary estimate of capital forma- tion during the years 1960-64 was made which covered building and construction on the one hand, and plant, machinery and equipment on the other.
395. Other research included exercises on trade with China, South Africa and Eastern African countries, an analysis of import and export prices (unit values), an analysis of discrepancies in trade statistics of Hong Kong and other countries, and an end-use analysis of imports in 1965.
PUBLICATIONS
396. For the monthly Statistical Supplement to the Government Gazette, the Branch continued to collect and edit returns from public companies and other Government departments. To this supplement were added a monthly series of seasonally adjusted indexes of passenger- journeys classified by undertakings and by areas; quarterly statements of bank loans and advances classified by sectors of agriculture, industry, commerce and services; and fire prevention statistics. The layout of the tables for shipping was revised so as to separate ocean-going vessels from other vessels. The Consumer Price Index (all items and by sections of commodity/service) and its moving annual average are now published in this Supplement monthly.
397. The results of the Household Expenditure Survey conducted from September 1963 to August 1964 were published in April 1965 for public information in two volumes: 'Report on the Household Expenditure Survey, 1963-64 and the Consumer Price Index' and 'Report on the Cost of Living Survey, 1958-1963-64'.
398. A statistical review of Hong Kong's overseas trade in 1964 in the context of the economy as a whole and against a longer historical background was published for the first time as a separate booklet rather than a chapter in the Annual Departmental Report. A similar review was prepared for the first half of 1965 and was issued as a supplement to the Departmental Quarterly Report for July-September 1965.
DATA PROCESSING
399. The machine room is responsible for the monthly tabulation of the Colony's trade statistics, commodity-by-country (published) and country-by-commodity (unpublished). For 1965, a special supplement was
85
tabulated and issued, setting out annual trade statistics by commodity groups within countries. Each month, some 50 special returns on trade statistics are prepared for consulates, trade commissions and merchant houses, either by commodities or by countries. Other work on trade statistics related to summary tables for the statistical supplement to the Government Gazette; regular analyses of exports of China and E.E.C. countries origin; trade statistics on cotton textiles compiled for the G.A. T.T. and the International Cotton Advisory Committee, cargo movements by air and calculation of import and export price indexes.
400. Work undertaken for the Education Department comprised processing of the half-yearly school enrolment returns and of pre- examination data for the various school examinations. Work on processing results of both the Secondary School Entrance Examination and the English School Certificate Examination, 1965, started in early June and was completed early in August 1965. Further work included tabulating examination results for publication, printing certificates of pass and statements of success, and listing results of candidates of each school.
401. For the Public Works Department, machine calculation of traverses was carried out for the Crown Lands and Survey Office, and data on traffic loads at specified hours on certain roads in Kowloon were processed for the Roads Office. An analysis of hydrological data from the water resources Survey was made for the Water Authority in September 1965 and cards were punched and verified for the Authority's water accounts during the first quarter of 1966. Punching, computing and tabulating were undertaken for the Passenger Transport Survey Unit on the data obtained from various surveys which included surveys relating to school journeys, to commercial vehicle routes, and to passenger journeys on public transport.
402. In December 1965 and January 1966 an exercise was undertaken for the Advisory Committee on Telephone Services which involved calculating the standard deviation of various distributions of waiting times for telephones that were installed during the period December 1964 to November 1965.
403. Other data processing matters dealt with in the machine room comprised the compilation of monthly, quarterly and annual returns on industrial and occupational accidents for the Labour Department; monthly analysis of death statistics for the Registrar General's Depart- ment; filing of meteorological reports, and conversion of rainfall data for the years 1884 to 1939 for the Royal Observatory; and an audience
86
survey for Radio Hong Kong. The Type 555 calculator was made available to Stores Department for two days each month.
404. From time to time many hours of overtime were necessary in order to observe deadline dates, to catch up work already delayed and to perform urgent ad hoc jobs. During the year under review, more than three million cards were consumed.
405. During the year, the data processing equipment was enlarged by the installation of one Type 902 tabulator, one Type 208 mark-sensing and end-printing reproducer, one Type 365 collator, two Type 029 automatic punches and one Type 129 automatic verifier.
SURVEYS CONDUCTED BY THE ORGANIZATIONAL SURVEYS UNIT
406. During the year, a number of surveys were conducted in the punched-card data processing installation and in the Trade Statistics Section by the Organizational Surveys Unit.
XIV. ADMINISTRATION AND ACCOUNTS BRANCH
GENERAL
407. The Administration Branch, which serves the whole of the Department, is under the control of a Senior Accountant and Secretary, a Senior Executive Officer Class II post, who is supported by four Executive Officers Class II, an increase of one over the previous year. These officers are individually responsible for personnel, accounts and stores, accounting and other aspects relating to Overseas Office, and general administrative matters respectively.
ORGANIZATION AND PERSONNEL
408. The distribution of branches within the Department at the end of the year is shown in Table 1, whilst Table 10 shows the distribution of the authorized establishment of the Department at the end of March, 1966 with comparative figures for the previous year.
Departmental Organization
409. A major reorganization took place during the year of the Industry Inspection Branch whose main functions are to carry out in- spections of factories registered for Certification of one type or another. This work was previously carried out by the Preventive Service, but in
87
May, 1965, the Finance Committee approved new posts for the Branch which is headed by a Senior Industry Officer, who is assisted by 2 Industry Officers. Other posts include 6 Senior Industry Assistants, 22 Industry Assistants Class I and 50 Industry Assistants Class II. These new civilian posts were offset by a reduction of 1 Assistant Chief Preventive Officer, 1 Trade Officer, 2 Senior Revenue Inspectors, 2 Assistant Trade Officers, 4 Executive Officers Class II, 14 Revenue Inspectors and 50 Revenue Sub-Inspectors.
410. The last Annual Report reported the creation of a new Export Promotion Division which was segregated from the Development Division. One of the reasons for this change was to facilitate the transfer of the duties of the Export Promotion Division to a new autonomous Export Promotion Council. In anticipation of the necessary legislation of Hong Kong Trade Development Office, was provisionally set up towards the end of the year and moved on 30th March, 1966 into offices in the new Ocean Terminal. All the functions of the Export Promotion Division, with the exception of Trade Complaints but with the addition of Trade Enquiries are to be undertaken by the new autonomous council. The Government officers of the Export Promotion Division were seconded to the new organization for a period of one year to ensure minimum disruption of the Export Promotion activities.
411. The Department was responsible for setting up two further provisional organizations namely the Provisional Productivity Council and the Export Credit Insurance Corporation. Both were the outcome of Reports which were accepted by Government. Skeleton staff for both of these provisional organizations were recruited and some government officers were seconded from the Department, pending recruitment of suitably qualified personnel.
Establishment
412. In addition to the establishment changes mentioned above, a Senior Statistician post, offset by one Statistician post, was created with retrospective effect from April, 1964.
413. In November, 1965, approval was obtained for the creation of an additional, supernumerary post of Administrative Officer Staff Grade B to deal with the revision of the Importation and Exportation Ordinance and matters affecting the establishment of the provisional Trade Develop- ment and Productivity Councils.
88
414. A leave reserve of 32 Revenue Sub-Inspectors and 13 Assistant Revenue Officers for the Preventive Service was approved to enable officers to take vacation leave, thus reducing a large accumulation of vacation leave. In addition, a Chief Revenue Inspector post for Head- quarters (Staff) was approved by the Finance Committee by supplementary provision and additional posts of 1 Senior Revenue Inspector, 2 Revenue Inspectors, 18 Revenue Sub-Inspectors, 1 Woman Revenue Sub-Inspector, 1 Woman Senior Revenue Officer and 4 Women Revenue Officers were created, also by supplementary provision, to meet the increased volume of work at Kai Tak Airport.
Recruitment
415. The Administration Branch was again heavily engaged in recruit- ment in an attempt to bring the various departmental establishments up to strength. Continual wastage by way of resignations and transfers to other government posts added to the task of filling new vacancies. Twenty recruitment exercises were held throughout the year and a total of 145 departmental officers were recruited.
416. Efforts were continued to bring the Trade Grade establishment up to strength and during the year 1 Trade Officer and 6 Assistant Trade Officers were appointed. However, these appointments were offset by the retirement of 1 Senior Trade Officer, the resignation of 1 Trade Officer and the loss of three Assistant Trade Officers. At the end of the year there were two vacancies for Senior Trade Officer and three for Trade Officer. All substantive Assistant Trade Officer posts were filled, but the general position was somewhat complicated by the secondment of officers from the grade to the Trade Development Office, Productivity Council and Export Credit Insurance Corporation.
417. With the formation of the reorganized Industry Inspection Branch, recruitment to the new grades commenced from within the Preventive Service. External recruitment was in hand at the end of the year to fill remaining vacancies by advertisement in the local press. At the end of the year the Senior Industry Officer, 2 Industry Officers, 3 Senior Industry Assistant and 5 Industry Assistant Class I and 10 Industry Assistant Class II posts had been appointed from the Preventive Service.
Training
418. One officer from the General Clerical Service attended a course on Government Accounting and 2 Executive Officers attended a similar course at a higher level.
89
419. One Executive Officer attended a re-styled Establishment Course at the Secretariat Training Unit and one General Clerical Service officer attended a Techniques of Supervision Course also conducted by the Training Unit.
420. Mr. C. T. STRATTON, M.B.E., Senior Statistician and chief adviser to Government on statistics, attended a six months Statistics and National Accounting Course at the Institute of Social Studies at the Hague, Holland.
421. One Machine Supervisor and two Senior Machine Operators attended an International Computers and Tabulators Course in Hong Kong and four officers including one Assistant Trade Officer, one Machine Supervisor and two Revenue Inspectors attended a course on the funda- mentals of Electronic Data Processing conducted by the Hong Kong Management Association.
422. A part-time departmental training course for Assistant Trade Officers was commenced in early January, 1966 and lasted for two months. It was designed to give new and recently recruited members of the grade some background knowledge of the economy of the Colony and the functions of the department.
Appointments and Senior Staff Movements
423. Mr. D. C. C. LUDDINGTON, Administrative Officer, Staff Grade 'B' was appointed Deputy Director, Administration, on his return from leave on 7th October, 1965.
424. Mr. B. I. BARLOW, Administrative Officer, Staff Grade 'C', proceeded on leave on 1st November, 1965 prior to his resignation on 11th April, 1966.
425. Mr. C. P. HADDON-CAVE, Administrative Officer Staff Grade 'C', returned from vacation leave on 16th December, 1965 and was appointed to act as Administrative Officer Staff Grade 'B' and to fill the Deputy Director, Trade and Industry post vice Mr. T. D. SORBY who was seconded for special duties.
426. Mr. H. D. MILLER, Administrative Officer, took up duty as Assistant Director, Textiles and Certification Division vice Mr. J. D. MCGREGOR who proceeded on vacation leave on 16th April, 1965.
427. Mr. J. D. MCGREGOR, Assistant Director, returned from vacation leave on 24th November, 1965, and took charge of the Development Division.
90
428. Mr. D. G. JEAFFRESON, Administrative Officer, returned from vacation leave on 14th April, 1965 and took charge of the Overseas Trade Relations Branch.
429. Mr. C. T. STRATTON, Statistician, proceeded on vacation leave on 20th May, 1965, and during his absence was promoted to Senior Statistician with retrospective effect to 1st April, 1964.
430. Mr. NG Kwok-leung, Assistant Statistician was promoted Statistician with retrospective effect to 1st March, 1965 and was also appointed to act as Senior Statistician vice Mr. STRATTON.
431. Mr. T. N. LEIGH-BENNETT, Senior Trade Officer, left the Colony on 2nd July, 1965 to commence vacation leave prior to retirement, having completed over 10 years service with the Department, most of which was devoted to export promotion work. His effective date of retirement was 1st February, 1966.
432. Mr. A. G. TRICKETT, Senior Trade Officer, assumed duty in the London Office on 24th November, 1965 on the expiry of his vacation leave.
433. Mr. D. SARTAIN, Senior Executive Officer Class II, was transferred to the Colonial Secretariat establishment on 25th October, 1965 but remained in the Department on loan, undertaking special duties in connexion with the formation of the Trade Development Office.
434. Mr. T. V. C. REYNOLDS, Senior Executive Officer Class II, was transferred from the Education Department on 25th October, 1965 to take over the post of Senior Accountant and Secretary vice Mr. SARTAIN. 435. Mr. P. DARBY, Trade Officer, resigned with effect from 15th May, 1965.
436. Miss E. BARKER was appointed Trade Officer on 1st April, 1965. 437. Mr. A. A. TAVARES was appointed Assistant Trade Officer, on temporary terms, on 9th June, 1965.
438. Mr. J. C. C. CHAN, Executive Officer Class II, was appointed Assistant Trade Officer with retrospective effect from 14th September, 1964.
439. Mr. T. A. JOHNSTON, Executive Officer Class II, was appointed Assistant Trade Officer with retrospective effect from 26th July, 1965.
440. Mr. L. DEXTER, Assistant Trade Officer resigned with effect from 8th September, 1965.
441. Mr. L. GRAY, Assistant Trade Officer, reverted to Interpreter/ Translator and returned to the Judiciary on 23rd July, 1965.
91
442. Messrs. TSAO Kwong-yung, Health Inspector Class I, KIANG Kwai, Executive Officer Class II and TAM Kwok-chi, direct entrant, were appointed Assistant Trade Officers on 1st, 14th and 4th February, 1966, respectively.
443. Mr. R. V. L. HATTON, Chief Revenue Inspector, was appointed Senior Industry Officer with effect from 21st October, 1965.
444. Mr. D. YIP Yuk-pui, Acting Trade Officer, was appointed Industry Officer on 14th March, 1966.
445. Messrs. J. E. Cook, Kwok Po-man and J. M. HOWARD, Revenue Inspectors, were appointed Senior Industry Assistants with retrospective effect from 1st November 1965.
446. Mr. F. BISHOP, C.B.E., arrived in the Colony on 2nd December, 1965 to take up the duties of Training Adviser to the Preventive Service.
447. Mr. D. H. KNOX, Assistant Chief Preventive Officer, left the Colony on 15th November, 1965 on vacation leave prior to retirement.
448. Mr. A. L. TOKLEY, Assistant Chief Preventive Officer, returned from vacation leave on 19th May, 1965.
449. Messrs. G. E. WELSBY and D. A. NEISH, Senior Revenue In- spectors, were promoted to Chief Revenue Inspector with retrospective effect from 1st December, 1965, Mr. WELSBY having returned to the Colony from vacation/study leave on 3rd March, 1966.
450. Messrs. C. G. W. KERSWILL, WONG Kam-to, J. K. WILSON, LEE Kin-tak, A. SANDERS and LEUNG Kwok-ki, Revenue Inspectors, were promoted to Senior Revenue Inspector with retrospective effect from 1st December, 1965.
OFFICE ACCOMMODATION
451. The general increase of staff throughout the year made it necessary to find increased accommodation. Apart from Preventive Service outsta- tions, leased accommodation at Fung House, the Chinese Manufacturers Association Building and Li Po Chun Chambers had been necessary to cope with the expanded activities of the Department during previous years. With the formation of the Trade Development Office plans were made to move the old Export Promotion Division, whose activities were incorporated in the Trade Development Office, to the new Ocean Terminal building, thereby releasing the leased accommodation in the C.M.A. building. The Display Centre of Hong Kong Products, previously situated
92
in the City Hall, also moved into the Ocean Terminal. Efforts to reduce the administrative inconvenience of offices in leased buildings continued and active negotiations were well in hand with the Secretary of Chinese Affairs who had indicated his willingness to move the S.C.A. from the 1st floor of Fire Brigade Building to the new International Building. Plans were formulated to house the Industrial Development and Overseas Trade Relations Branches in Fire Brigade Building thereby releasing the leased accommodation at Li Po Chun Chambers.
452. The newly reorganized and expanded Industry Inspection Branch moved into offices on the top floor of the Housing Authority Headquarters Building at Ma Tau Kok and during the year a further area of 1,300 square feet were leased from the Housing Authority.
453. The proposal for the building of a cargo examinations shed at Man Kam To in the New Territories was approved.
454. Accommodation for the establishment of a Preventive Service residential training centre was obtained on the 11th and 12th floors of the Yuet Ming Building in Kowloon in October, 1965.
455. Several air-conditioning units were installed in the Certification Branch during the year and a further schedule to air-condition remaining offices in Fire Brigade Building was submitted to the Air-conditioning Committee of the Public Works Department for inclusion in the next financial year.
456. Many minor structural alterations were made in several branches in Fire Brigade Building in an effort to bring the building up to a reason- able standard of accommodation. A complete redecoration was undertaken in July, 1965 and over 150 requests were forwarded to the Public Works Department for minor repairs.
WELFARE
457. Staff Welfare is the responsibility of the Deputy Director (Administration) who is assisted by the Senior Accountant and Secretary.
Departmental Quarters
458. Work was progressing on a new block of flats in King's Road to provide additional residential accommodation for Preventive Service officers. It is hoped that these quarters will be ready for occupation by mid-1966. Another block of flats in Kowloon for 300 rank and file Pre- ventive Service officers remained in category 'C' of the building pro- gramme.
93
Welfare Fund
459. The Department operates two Welfare Funds, one for members of the Preventive Service and the other for the civilian staff. The Preventive Service Welfare Fund is established by Ordinance to (a) procure for members who are serving or for former members who have been retired on pension, gratuity or other allowance, comforts, convenience or other advantages not chargeable to public revenue and (b) grant loans to members who are serving or to former members who have been retired on pension, gratuity or other allowance. The fund consists of a sum voted annually by the Legislative Council. Grants and loans made from the fund during the year were mainly to cover general expenses of officers' dependants; purchases for the general welfare of the Preventive Service included recreational equipment, kitchen utensils to provide hot meals for officers on duty in the harbour and rice cookers for the Training School at Kwun Tong.
Leave
460. With the heavy commitment of work falling on the directorate and the Trade Officer Grade it was not possible for officers to take much local leave.
461. Once again vacancies in clerical establishment and difficulty in securing replacements frustrated attempts to set up a leave reserve. Generally speaking officers were permitted to take leave in short periods.
462. Sick leave for the entire Department amounted to 352 weeks. 16 women officers were granted maternity leave and 19 other officers received hospital treatment at various times.
Revenue Inspectors' Mess
463. The Mess held several social functions during the year culminat- ing in the Annual Christmas Dance.
Clerical Canteen
464. The canteen continued to function throughout the year and was well patronized by both clerical officers and junior members of the Pre- ventive Service.
Sports/Social Club
465. The departmental Sports/Social Club which was formed last year, continued its activities which featured a social evening preceded in the afternoon by a football match against a team of Executive Officers.
94
ACCOUNTS AND STORES
Revenue
466. Net revenue collected by the Department amounted to $264,801,297 ($262,109,719), an increase of 1.02% over the previous year. This amount represents 16.2% of the total Government revenue collected during the year. Details of revenue for dutiable commodities are given in tables 5 to 7 and Chapter XI.
Forfeitures
467. Revenue from forfeitures was lower than that of the previous year, but the proceeds of certain confiscated items will be shown in the 1966-67 financial year.
Expenditure
468. Supplementary provision of $1,375,915 over the estimate of $15,757,400 was approved during the financial year. The total depart- mental expenditure amounted to $16,474,151. The funds provided under Special Expenditure in respect of the Export Credit Insurance Scheme and the Productivity Centre were underspent due to the projects not having come into full operation.
Stores
469. The Department acquired new godown accommodation at Whitfield Road, Causeway Bay; these premises are being used for the storage of seized and confiscated goods.
470. A request for a post of an Assistant Stores Officer was accepted in principle by the Controller of Stores, and action is proceeding by supplementary provision.
471. A Treasury Stock Verification of the Stores Section revealed some minor discrepancies.
472. Confiscated liquor, tobacco and cigarettes were sold at an authorized rate equivalent to the retail price less 20%, but without any warranty as to condition. Free issues were confined to certain approved charitable organizations. Compared with last year, the quantities of items sold or issued free and their respective values were as follows:
95
Sold:
Liquor
Cigarettes
Cigars
Tobacco...
Distributed free:
Liquor
Cigarettes
Tobacco...
:
:
1964-65
1965-66
Quantity
Value
Quantity
Value
9,319 qts.
$45,414
11,853 qts.
$23,889
423,741 pcs.
391,200 pcs.
20,540
10,552
4,035 pcs.
2,180 pcs.
2,592 lbs.
Total
10,563
2 lbs.
47
...
...
$76,517
$34,488
1964-65
1965-66
Quantity
2,870 qts. 550,229 pcs.
Value
$13,687 16,066
Quantity
Value
3,671 qts.
$18,355
468,924 pcs.
14,980
1,747 lbs.
6,499
619 lbs.
2,847
Total
$36,252
$36,182
473. Proceeds of cash sales are apportioned between the appropriate revenue sub-heads, namely Duties and the Revenue Reward Fund, while credits resulting from issues to other departments go entirely to the Fund, which is used for the payment of rewards for information leading to the seizure of contraband. The Fund is maintained at a maximum of $200,000, sums in excess of this amount being transferred to general revenue. Total credits during the year resulting from sales and issues to other departments were:
Revenue Head 1 Duties: Sub-head 2 Liquor... Revenue Head 1 Duties: Sub-head 4 Tobacco Revenue Reward Fund
...
$15,966
...
2,545
15,977
$34,488
474. In view of the large amount of revenue collected in connexion with dutiable commodities, the Audit Department conducts a running audit of the accounts. The department maintains close liaison with the Audit team.
HONG KONG,
31st January, 1966.
T. D. SORBY,
Director of Commerce and Industry.
96
97
APPENDIX 1
COMMERCE AND INDUSTRY DEPARTMENT ORGANIZATION CHART (as at 31st March, 1966)
DIRECTOR
DEPUTY DIRECTOR (Trade & Industry)
ASSISTANT DIRECTOR
TEXTILES & CERTIFICATION
DIVISION
Senior
Trade Officer
DEPUTY DIRECTOR
(Administration)
ASSISTANT DIRECTOR
ASSISTANT DIRECTOR
DEVELOPMENT DIVISION
EXPORT PROMOTION
DIVISION
ASSISTANT DIRECTOR
DUTIABLE COMMODITIES & CONTROLS DIVISION
Trade Officer
PREVEN.
TIVE SERVICE
Chief Preventive Officer
Certification
Branch
Textiles
Branch
Trade Officer Trade Officer
Industry Inspection Branch
Industrial Development
Branch
Overseas Trade Relations Branch
Trade Development
Branch
Trade Publications Branch
Dutiable Commodities Branch
Trade Licensing Branch
Senior
Senior Trade
Senior Trade
Industry
Officer
Officer
Senior Trade Trade Officer
Officer
Assistant
Assistant
Officer
Trade Officer
Trade
Officer
Economic
Information Centre
Accounts &
Statistics Branch
Administration
Branch
Senior
Statistician
Senior Accountant & Secretary
Overseas Offices
London Office: Assistant Director
Sydney Office: Senior Trade Officer Brussels Office: Assistant Director
APPENDIX 2A
EXPORTS OF COTTON TEXTILES RESTRAINED UNDER G.A.T.T. COTTON TEXTILES ARRANGEMENTS FROM OCTOBER, 1961 TO SEPTEMBER, 1966
98
Restrained Countries
4th Long Term Year 1965–66
3rd Long Term Year 1964-65
2nd Long Term Year 1963-64
1st Long Term Year 1962-63
Short Term Year 1961-62
Unit
Restraint Level
Restraint Level
Exports
Restraint Level
Exports
Restraint Level
Exports
Restraint Level
Exports
U.S.A.
Sq.Yd.
287,979,190 37 categories
274,712,288 273,255,307
37 cats.
30 cats.
251,112,600 243,386,600| 231,144,890| 227,157,291| 231,144,890 244,858,353(1)
36 cats.
30 cats.
Canada
Doz.
+
736,000 6 garment cats.
712,000 7 garment
599,243
cats.
614,000 6 garment cats.
484,595
Sq. Yd.
9,406,000
6,000,000
4,728,883
N.A.
5,863,113
600,000 6 garment cats.
N.A.
517,954
385,000 4 garment cats.
400,138(1)
5,994,087
N.A.
1,021,486
11 fabric cats.
6 fabric cats.
Republic of Germany
Doz.
400,000 Woven night-
380,000
339,167(3)
350,000
309,139
N.A.
347,987
N.A.
214,027
wear
Federal
Norway
Doz.
22,000 Woven night-
20,000
19,788
18,000
16,951
16,000
15,960 N.A.
46,897
wear
Doz.
61,000 Woven sport & work shirts
56,000
31,790
51,000
45,389
46,000
44,975 N.A.
70,609
Benelux(2)
pcs.
1,251,517 Woven shirts
N.A.
1,539,648
N.A.
1,152,300 N.A.
1,015,320 N.A.
622,812
(1) The restraint levels for some categories established in accordance with the 15 month roll-back formula were lower than the
exports recorded for the Short Term Year.
(2) From 1st January to 31st December, 1966. All previous exports based on calendar year.
(3) Period for utilization of quota extended to 31st December, 1965.
N.A. not applicable.
=
66
APPENDIX 2B
EXPORTS OF RESTRAINED COTTON TEXTILES TO BRITAIN
1963 to 1965
1963
1964
1965
Description
Unit
Restraint Level
Exports
Restraint Level
Exports
Restraint Level
Exports
Yarn ...
Lbs.
6,300,000
6,300,000
6,300,000
6,241,132
6,300,000
6,225,010
Loomstate Fabrics
Sq. Yds.
79,999,700
81,688,535
113,582,250
100,000,000
102,130,811
105,682,162 *
Finished Fabrics
Sq. Yds.
19,054,265
20,356,877
21,587,146
Garments and Made-
ups goods
..Sq. Yds.
85,000,000
84,611,060
86,811,189
86,749,784
89,829,838
59,832,933
30 million sq. yds. plus a supplementary quota for 1964 and 1965.
* Sub-ceiling for finished peicegoods=30 million sq. yds. for 1963.
Note: Restraint Levels for Fabrics and made-ups and garments groups in 1964 and 1965 include a total supplementary quota of
14,454,000 sq. yds.
Export figures for 1963 and 1964 include shipments made during the carry-over period in the subsequent year. Made-ups and Garments quota might be shipped as fabrics under the special shipment arrangements in late 1965.
APPENDIX 2C
EXPORTS OF WOOLLEN KNITTED OUTERWEAR TO THE FEDERAL REPUBLIC OF GERMANY
(RESTRAINED AS FROM 1ST JANUARY, 1966)
1966
1965
1964
1963
1962
Unit
Restraint Restraint
Level
Level
Exports
Restraint Level
Exports
Doz.
875,000
N.A.
793,468
N.A.
735,304
Restraint Level
N.A.
Exports
461,703
Restraint Level
N.A.
Exports
210,729
Sources: (1) 1962-63-Hong Kong Trade Statistics.
(2) 1964-65-Licensing Records.
Year
Certificates
ORIGIN STATISTICS
1964-65
Value of Goods Certified $Mn. (Percentage Change)
No. Issued (Percentage Change)
1965-66
Value of Goods Certified $Mn. (Percentage Change)
APPENDIX
CERTIFICATION OF
1963-64
Value of Goods Certified $Mn. (Percentage Change)
1,036.7 (+20.1)
3
No. Issued (Percentage Change)
145,098 (-+-2.2)
No. Issued (Percentage
Change)
Standard Certificates of Origin
141,943
(+3.7)
1,230.7
131,701
(+18.7)
(-9.2)
Commonwealth Preference Certificates:
(a) Britain
73,287
909.7
74,029
940.4
74,209
(+9.9)
286,237
(+15.5)
(+1.0)
297,123
(+3.4)
(+0.2)
275,890
(b) Other Countries
37,829
(+5.4)
189.9
38,937
(+3.8)
228.5
31,676
(-7)
(-3.0)
(+21.4)
(+2.9)
(+20.3)
(-18.6)
Comprehensive Certificates of Origin:
(a) Commercial
W
(b) Mail Order
(c) Tourist
(d) Gift Plan
(e) Sample
Total
:
:
Domestic Exports ($Mn.)
Percentage Certified
Value of stamp fees paid (Including
miscellaneous certificates, not recorded above)
1,300.2 (+5.6)
905.1 (-3.8)
178.9 (-2.2)
33,178
(+14.5)
18,477
(+42.7)
111,761
39,059
38,300
(+17.7)
(-1.9)
23,413 (+26.7)
30,846
(+31.7)
548.7
100,890
658,2
(+11.8)
13,797
(+3.3) ((+11.7)
8.094
(+20.3)
90,387
(-9.7)
(+20.0)
(-10.4)
133,652
12,550
121,958
10,215
110.840
(-9.0) (-8.7)
(-18.6)
(-9.1)
8,518
10,238
(+28.2).
(+5.2)
(+20.2)
438,366
(+8.5)
2,685.0 (+18.6)
442,494
(+0.9)
3,057.7 (+13.9)
417,572
(-5.6)
3,970
4,590
5,116
67.6
66.6
62
100
$4,472,860
$4,702,155
101
$4,453,585
782.5 (+18.9)
3,166,7 (+3.6)
102
APPENDIX 4
TRADE COMPLAINTS FROM OVERSEAS COMPANIES OR INDIVIDUALS
HANDLED BY THE DEPARTMENT
From 1.4.1965 to 31.3.1966
Country
Australia
Central
Europe
Africa
and New
& South
(Exclud-
Middle East
U.K. U.S.A.
Category
Zealand
America
America ing U.K.)
Miscel- laneous Total Countries
11
67
10
14
18
17
268
19
424
6
13
1
20
6
12
24
2
84
...
22
1
15
28
27
10
9
5
117
2
1
4
4
1
2
1
15
2
2
Non-delivery
Inferior quality
Outstanding debts
Short-shipment
...
Breach of contract
Infringement of trade
marks
...
Infringement of patents &
designs
...
1
1
1
3
6
5
11
Miscellaneous
5
8
4
13
4
10
36
8
88
...
...
Total
46
89
31
80
59
59
345
35
744
...
APPENDIX 5
NET REVENUE COLLECTED FROM ALL SOURCES
Actual Revenue
Approved Estimates
Increase/ Decrease
1965-66
1965-66
1964-65
$
$
$
%
Duties
Hydrocarbon oils imported
80,000,000 82,390,613
75,816,340
+ 8.7
Intoxicating liquor imported...
50,000,000
54,639,473
48,220,843
+ 11.7
Liquor other than intoxicating
liquor imported
2,500,000
1,926,317
2,325,429
20.7
Tobacco imported
...
105,000,000
93,683,785
101,184,068
8.0
Liquor locally manufactured...
23,000,000
20,493,504
21,350,355
4.2
Table waters
...
6,500,000
6,244,839
6,328,163
1.3
Licences
Hydrocarbon oils
210,000
194,795
195,887
0.6
Liquor
...
2,840,000
2,746,374
2,582,541
+ 6.3
Tobacco
Miscellaneous (table waters)...
Fines and Forfeitures
Fines
Forfeitures
Fees of Court or Office
895,000
783,596
785,935
0.3
30,000
28,835
32,207
11.7
95
35
...
200,000
108,172
173,895
60.7
Denaturing
450,000
421,916
453,113
7.4
Factory inspection and
supervision
35,000
39,914
57,417
43.8
Official certificates
20,000
13,575
17,400
―
28.2
Official signatures
7,000
4,415
5,080
15.1
Departmental services and
supervision
201
282
40.3
Overpayments in previous
years...
11,105
52,260
Anti-narcotic smuggling guards
13,000
8,036
10,234
27.3
Bonded warehouse supervision
360,000
369,524
363,741
+1.6
Loss of, or damage to
Government property
100
189
26
Officials and others for light,
fuel, etc. in Government
buildings
100
Advertisement revenue
600,300
588,947
437,029
+ 34.7
Publications
14,000
15,679
12,586
+ 24.6
Surplus and condemned stores
18,962
1,645,754
Miscellaneous
39,500
68,435
59,099 + 15.8
272,714,000 264,801,296 262,109,719 + 1.0
103
Liquor:
Whisky
Brandy
Gin
Wines
Beer
Other European Type...
Chinese Type-
(a) Locally Distilled
(b) Imported
Spirituous liquor other than
intoxicating liquor
Methyl Alcohol
Total:
Tobacco:
Cigarettes & Cigars
European Smoking Tobacco
(including Snuff)
Chinese Prepared Tobacco
Tobacco Leaf
Total:
PAR
APPENDIX
DUTY FROM DUTIABLE
6
COMMODITIES (GROSS)
1964-65
1965-66
1963-64
Unit
Quantity
Per- centage Change
Duty
Per- centage Change
Quantity
1
Per- centage Change
Duty
Per- centage Change
Quantity
Per- centage Change
Per-
Duty
centage Change
$
$
$
Gals.
>>
101,741 200, 190
37
34,399
E
119,551
ነታ
6,120,243
11
14,246
++++++
23.5
6,641,301
23.5
118,255
+ 26.2
14,440,755
26.0
247,371
9.4
2,312,815
9.2
40,963
17.6
2,615,363
14.0
+ 27.9
11,188,429
33.7
138,513 7,481,808
6.9
994,133
7.0
16,766
++++++
16.2
7,718,757
23.6
17,858,091
19.1
15.9
2,765, 196 2,877,881
+ 22.2
13,879,265
17.7
1,160,563
++++++
16.2
127,254
23.7
268,034
19.6
44,906
10.0
142,668
24.1
7,996,576
16.7
17,165
++++++
7.6
8,320,674
8.3
19,305,516
9.6
3,036,177
3.0
2,958,217
6.9
15,276,598
2.4
1,201,243
++++++
7.8
8,1
9.8
2.8 10.1
3.5
99
2,165,575
+
1.9
15,176,811
J
793,213
+
34.5
7,540,747
++
3.3
2,087,863
38.6
1,164,408
+1
3.6
46.8
14,509,957 10,922,343
4.4
2,071,519
0.8
14,418,550
0.6
+
44.8
1,411,998
+
21.3
12,847,592
+ 17.6
འ འ
195
129,308
+
33.0
1,704,414
+
29.5
1,916
+ 111.0
9,680,382 +
21.2
33,013
62,647,781
+ 102.2
200,135 2,855
+
54.8 + 49.0
2,323,817
53,726
++
36.3
62.7
+ 20.5
11,498,937
+ 18.8
74,069,596
+
18.2
145,775 2,783
12,228,678
27.2
1,946,027
16.3
2.5
40,396
24.8
+
6.3
79,350,990 +
7.1
lbs.
5,833,366
+
12.5
* 46,015,584 +
13.3
"
*
71,697 462,249 19,939,707
+++
7.6 *
3.2
427,878 1,155,623
26,307,019
21.4*112,163,464
18.9 159,762,549 + 19.2
+++
7.6
3.2
22.2
6,006,851
85,706 487,769 16,392,246
3.0
52,134,871
+
13.3
6,189,989
+
++|
19.5
563,033
+
31.6
68,007
3.0† 54,296,655
20.7 †
+
4.1
5.5
1,219,425
+
5.5
17.8
96,355,431
―
14.1
446,547 17,178,892
8.5
453,622 1,116,368
19.4
8.5
+
+ 4.8 †100,946,814
4.8
22,972,572
—
12.7
150,272,760
5.9
23,883,435
+
4.0
• r
156,813,459 +
4.4
Hydrocarbon Oils:
Light Oils
Diesel Oils
Furnace Oils
Other Type
Total:
Table Waters:
:
:
Imp. Gals.
21,710,745
**
46,089,210
"
188,267,282
»
44,010,849
-+++
5.9
27,895,954
12.1
14,179,617
13.7
18,826,728
+++
5.4 25.4
24,856,530
53,175,778
13.7
217,237,562
+
9.0
4,339,356
+
8.5
46,496,633
++++
14.5
30,512,062
9.4
15.4
19,007,521
34.0
26,320,710 60,473,912
15.4
21,723,756
15.4
227,421,650
+
5.6
4,580,925
5.6
48,394,480
++++
5.9
† 31,913,052
4.1
13.722,966,122
4.7
22,742,165 4,776,154
++++
4.6
20.8
4.7
4.3
300,078,086
+
12.1
65,241,655+
11.8
341,766,503
+
13.9
75,824,264 +
16.2
362,610,752
+ 6.1 82,397,493 +
8.7
Gals.
11,281,135 + 8.1
5,414,947 + 8.1
13,184,264
+ 16.9
6,328,447 +
16.9
13,010,206
1.3
6,244,900
1.3
Refund and Drawback
Intoxicating Liquor
Spirituous liquor other than
intoxicating liquor
Table Waters
Tobacco
Hydrocarbon Oils
Total:
* Duty rates increased with effect from 26.2.64.
$ 1,060,547
+ 269.4
48,711 850
50.7
+1150.0
66,448,307
35.4
14,504 +
24.5
67,572,919
+
36.6
2,120,822
52,147 284
+ 100.0
7.1
66.6
2,231,590
60,106 61
26.1
-
45,4
24.1
§ With effect from 16.12.63 the procedure in relation to sale of duty-free liquor to departing air
passengers changed over to 'refund of duty on duty-paid liquor' basis.
49,088,692
7,923
51,269,868
† Duty rates increased with effect from 24.2.66.
Duty rates on Motor Spirit and Diesel Oil for Other Road Vehicles increased with effect from 24.2.66.
63,129,674 6,879
+ ++1
65,428,310
5.2
15.3
78.5 28.6 13.0
+
27.6
104
105
APPENDIX 7
REVENUE FROM DUTIABLE COMMODITIES LICENCES, 1965-66
Importer's:
Liquor
Tobacco
Hydrocarbon Oils
Table Waters
Methyl Alcohol
Exporter's:
Liquor
...
•
Tobacco
...
Hydrocarbon Oils
Table Waters
Methyl Alcohol
Dealer's:
...
European-type Liquor Chinese-type Liquor Spirituous Liquor
Tobacco
...
Hydrocarbon Oils
Methyl Alcohol Medicated Liquor Retailer's:
...
...
...
..
Chinese-type Liquor Spirituous Liquor
Beer
Tobacco
...
Hydrocarbon Oils
Methyl Alcohol
Medicated Liquor
Manufacturer's:
No. of Licences Issued
Revenue
$
347
咖啡
173,500.00
76
...
210
...
38,000.00 107,500.00
37
•
11,100.00
39
390.00
...
163
4,560.00
55
...
1,530.00
45
940.00
11
...
...
1,560.00
2
20.00
484
...
2,065
723,300.00 1,313,510.00
469
46,810.00
199
99,500.00
420
...
*
42,000.00
35
350.00
1
50.00
240
35,400.00
•
...
1,969
177,580.00
...
...
+
3,453
210,175.00
9,970
...
...
621,070.00
...
...
1,036
25,877.50
...
...
...
...
7
70.00
13
650.00
14
1
...
...
22
•
...
...
52
17,000.00
2/
7
...
...
7,000.00
18
11,700.00
+
17
...
22,060.00
8
11,000.00
10
10,000.00
...
12
700.00
7
70.00
353
...
3,530.00
Distillers
Brewer
Liquor
Still
Liquor Manufacturer
Tobacco
Table Waters
Warehouse:
Liquor
Tobacco
Hydrocarbon Oils
Table Waters
Methyl Alcohol
Ship and Harbour Vessel Licences
Licence Fees for Persons Importing for Own Use
and Miscellaneous
...
..
...
Total:
Refunds: Liquor Licence Fees
...
106
...
35,116.00
21,800
$3,753,618.50
19.58
Net Total:
$3,753,598.92
APPENDIX 8
MAJOR CONFISCATIONS UNDER OTHER LEGISLATION 1965–66
Legislation
Commodity
Importation and Exportation
Gold
Ordinance, Chapter 50, and
Silver coins
regulations made under
Unit
Quantity
lb.
418.87
...
peso.
26,000
Mixed coins and pieces of metal containing 48.773 kilo of silver Granulated metal con-
taining 97.282 kilo of silver
+
kilo.
67.273
kilo.
98.067
Metal rods containing
7.556 kilo of silver
kilo.
7.586
Metal ingots containing
10.000 kilo of silver
kilo.
10.000
Wrist watches
no.
1,424
...
Watch Straps
no.
50
Gramophone records
no.
263
Text books
no.
254
Sarongs
no.
806
24
C.C.
2,500
Agricultural Poisons
Regulations 1955
Penicillin Ordinance,
Chapter 137
Walkie Talkie 'Miniature' pair
Transceivers
Folidol
set
Penicillin tablets
Penicillin ointment
Stretopmycin Dihydrostreptomycin Oxytetrocycline hydro-
chloride
Crystaphen tablets
Prednimycin
Crystaphen
Procaine Penicillin G
in oil
...
...
no.
222
...
tube
30
vial
60
...
vial
40
...
lb.
15
...
bottle
19
tube
4
...
bottle
5
bottle
vial
vial
12
...
tube
tube
22205
Pharmacy and Poisons
Ordinance, Chapter 138
Penicillin G Sodium Benzylpenicillin ... Neomycin sulphate Penicillin lozenges
Normidopyrine Methane-
sulphate Prednisolone
107
lb.
££
lb.
112
APPENDIX 9
CONFISCATIONS UNDER THE DUTIABLE COMMODITIES ORDINANCE (NO. 26 OF 1963) AND DANGEROUS DRUGS ORDINANCE, CHAPTER 134
COMMODITY
Tobacco
Chinese prepared tobacco
Foreign cigarettes
Macau and Chinese cigarettes
Cigars
Tobacco stems
Tobacco leaf
Pipe tobacco
Tobacco dust
Liquor
...
European type liquor Chinese type liquor
Beer
...
Chinese medicinal wine
...
•
QUANTITY
UNIT
1964-65
1965-66
lb.
8,527.51
586.98
lb.
1,095.80
1,339.03
...
lb.
936.70
1,108.38
lb.
450.88
59.84
lb.
36.50
...
lb.
110.27
42.13
lb.
86.61
11.09
...
Ib.
25.00
gal.
ཚུ་
803.29
910.10
gal.
3,375.30
5,308.43
gal.
928.00
455.62
...
gal.
307.00
147.79
Alcohol
•
...
...
...
gal.
8.70
76.50
Mash
gal.
49,775.00
63,247.00
Stills
no.
224
227
Hydrocarbon Oils
Treated diesel oil ...
Dangerous Drugs
Opium, raw
Opium, prepared
Opium, dross
Opium, water
Morphine
...
...
Morphine hydrochloride...
Diacetylmorphine hydrochloride
Barbitone
Opium pipes
Opium pipe heads
Opium lamps
gal.
1,489.90
3,259.50
lb.
1,265.18
1,071.63
lb.
23.63
2.68
Ib.
3.58
1.23
...
...
fl. oz.
488.50
80.80
lb.
124.41
...
lb.
131
160.88
lb.
74.84
0.04
lb.
92.43
0.01
no.
193
13
...
...
no.
44
3
no.
642
14
108
APPENDIX 10
DISTRIBUTION OF AUTHORIZED ESTABLISHMENT
31.3.66
31.3.65
Directorate
Development Division
Overseas Trade Relations Branch ... Industrial Development Branch
10
8
...
•
•
25
29
17
46
Textiles and Certification Division
Certification Branch...
Textiles Branch
Certificates of Origin Section
Comprehensive Certificates of Origin Section
Commonwealth Preference Section
Industry Inspection Branch *
Export Promotion Division
45
6
...
40
19
17
...
170
297
Trade Publications Branch...
Controls Division
Trade Licensing and Supplies Branch
Dutiable Commodities Branch
Kowloon Office
Preventive Service
Headquarters Section
Prosecution and Investigation Section
Training Section
Eastern Revenue Station
Western Revenue Station Special Section (Narcotics) Kowloon Revenue Station Fanling Revenue Station... Tai Lam Revenue Station
Overseas Offices
London Office Sydney Office Brussels Office
Statistics Branch
Trade Statistics Section
...
...
Miscellaneous and Research Sections
Price Index Unit
...
Data Processing Unit
...
Administration and Accounts Branch ...
Trade Development Branch
19
...
...
...
10
29
28
32
...
19 79
65
11
...
Administration Section
Accounts and Stores Section
..
Leave Reserve
5
30
149
...
232
124
85
50
47
29
596
567
...
28 6
25
6
...
...
2
36
2
33
6
6
51
51
23
17
...
24
26
...
37
141
35
135
2
37
21
19
24
84
23
2*22
34
78
...
1,417
1,181
19
79
སཋ ༢༣འཐ=། སླལྐཋ ཋཌ་ོམིནྣིཙྪསིཾ
43
209
29
* Including 70 Supernumerary and 6 Substantive Posts of Preventive Service Staff.
109
APPENDIX 11
TRADE MISSIONS, ETC. FROM OVERSEAS
Origin
Name
No. of Delegates
Leader of Delegation
France
French Textile Mission from the Productivity Centre of the French Federation of Men's and Boy's Clothing and Apparel Manufacturers
22
M. Claude RICA-LEVY
Duration of Visit 1965
Reason for Visit
25-29th April
To meet local businessmen and
trade associations.
Sweden
Delegation from the Swedish Wholesalers and Importers Association
21
26th-29th April
To increase business contacts.
Australia
Delegation from Western
4
Mr. F. J. MALONE
28th April 4th May
Australia sponsored by the Western Australian Chamber of Manufacturers
U.S.A.
Delegation from the Port of
Seattle
4
Mr. M. H. BAKER, President
of the Port of Seattle Commission
Early May
U.S.A.
Washington State Trade
Mission
18
Mr. W. J. PENNINGTON,
1st-4th May
President of the Seattle
Chamber of Commerce
U.S.A.
Visit of Officials from the
State of New York
2
Mr. Keith S. MCHUGH,
Commissioner of Commerce for the State of New York and Mr. Howard D. MAC- PHERSON, Director of the International Commerce Division of the New York Department of Commerce
1st-6th May
To promote two way trade
between Western Australia and Hong Kong.
To acquaint local businessmen with the facilities of the Port of Seattle.
To promote trade between
Washington State and Hong Kong and to discuss joint venture investment opportunities.
To explain the facilities that the State has to offer to importers and exporters.
110
South Africa
Trade Mission from the
20
Johannesburg Chamber of Commerce
Mr. M. M. WOOD, Assistant
Secretary of the Johannesburg Chamber of Commerce
5th-11th May
To increase mutual trade.111
Origin
U.S.A.
Name
Chicago Trade Mission
APPENDIX 11—Contd.
No. of Delegates
Leader of Delegation
40
Mr. Vilas JOHNSON
Duration of Visit 1965
Early May
Reason for Visit
To analyse the prospects of increasing two way trade.
Norway
Delegation from the Norwegian
Wholesale Merchants and Importers Federation
11
Mr. Gunnar MELSOM
Pakistan
Visit of Pakistan Officials
2
Mr. Wazir ALI, Vice-Chairman
of the Pakistan Export Promotion Bureau and Mr. Badi us SALAM, Vice- President of the Federation of Pakistan Chambers of Commerce and Industry
10th-13th May
To meet local businessmen.
15th-17th May
India
Visit of Indian Textile
Delegation
5
Mr. R. A. PODAR, Chairman of the Indian Cotton Mills Federation
17th-20th May
To invite businessmen and
trade associations to par- ticipate in the Karachi Inter- national Fair to be held in April 1966.
To discuss matters of mutual
interest with members of the Hong Kong Cotton Spinners Association and the Federa- tion of Hong Kong Cotton Weavers.
To hold discussions with local
businessmen and indus- trialists.
Canada
Trade Delegation from Nova
Scotia
5
Mr. H. P. MACKEEN,
Lieutenant Governor of Nova Soctia
19th-22nd May
Canada
Ontario Trade Mission
7
Mr. S. RANDALL, Minister of
Economics and Development for the Province of Ontario
22nd-25th May
To promote mutual trade.
U.S.A.
Mr. O. A. PEARSON, Co-
ordinating Director of the California World Trade Authorities Council
1
Canada
Trade Mission from British
Columbia
8
The Hon. W. A. C. BENNETT, Prime Minister of British Columbia
24th-27th May
3rd-6th June
To examine the possibility
of the State of California opening a trade office in Hong Kong.
To increase two way trade
between British Columbia and Hong Kong.
12
112
APPENDIX 11-Contd.
Origin
Name
No. of Delegates
Leader of Delegation
Netherlands
Netherlands Economic Mission
16
France
Mr. Bertrand JACQUILLAT, of
the French National Centre for External Trade
1
Ireland
Mr. Roderic MURPHY, Trade
Adviser of the Irish Export Board
1
Mr. Sydney J. van den BERGH, President of the Netherlands Council for Trade Promotion
Duration of Visit 1965
15th-19th June
17th July-25th Aug.
19th Aug. 5th Sept.
11th-16th Sept.
15th-19th Sept.
Reason for Visit
The main object of the visit
was to promote the expan- sion of trade, but members also discussed the pos- sibilities of joint venture arrangements, the exchange of technical knowledge and patent agreements. The leader of the delegation met His Excellency the Governor and the Director.
To make a survey of the
possibilities of French investment in Hong Kong.
To investigate the potential for Irish products new to the local market and to encourage sales of products already being exported.
To promote British exports.
To meet local businessmen
and industrialists.
To sell British woollen textiles.
To increase goodwill and
mutual trade.
U.K.
Norway
Sir Miles THOMAS
1
Visit of Norwegian Trade and
Shipping Mission
13
Mr. O. L. SKUNDBERG,
Secretary of the Norwegian Shipowners Association
Britain
Wool Textile Industry Trade
Mission
Approx.
No official leader
10th-17th Oct.
24
U.S.A.
Trade Mission from the San
Francisco Chinese Chamber of Commerce
40
Mr. Lansing Kwok, Past
11th-18th Oct.
President of the San
Francisco Chinese Chamber of Commerce
Sweden
Visit of Delegation from
Provincial Swedish Chambers of Commerce
20
14th-18th Oct.
Sweden
Delegation from the
19
Gothenburg Chamber of Commerce
Mr. Bertil THORBURN, President
of the Gothenburg Chamber of Commerce
28th Oct. 2nd Nov.
To contact Hong Kong
manufacturers.
To promote trade between
Hong Kong and Sweden and to confer with their local agents.
113
APPENDIX 11-Contd.
Duration of Visit 1965
Origin
Name
No. of Delegates
Leader of Delegation
U.S.A.
Visit by members of the North
Carolina Business Executives Trade Study Commission
20
Europe
(France,
Germany &
Visit of European Retailers and Department Store officials
21
Denmark)
U.S.A.
New England World Trade
Centre Mission
21
Mr. Eli GOLDSTON
Britain
Visit of Mr. G. R. GOUDE,
1
Secretary of the British
Toy Manufacturers Association
Mr. Albert G. MAYERS, Jr., President of Textiles Inc. and Mr. Basil Whitener, U.S. Congressman from North Carolina
Mr. Edmond BALLERAND,
Secretary General of the Modern Merchandising Methods Club of Paris
31st Oct. 2nd Nov,
1st-3rd Nov.
2nd-5th Nov.
8th-15th Nov.
U.S.A.
U.S. Trade Mission
5
Mr. Roy GoOTENBERG,
10th-21st Nov.
Director of the Trade Missions Division of the U.S. Department of Commerce
Reason for Visit
To study business techniques
and meet local businessmen.
U.S.A.
Illinois Trade Mission
60
Mr. Otto KERNER, Governor
of Illinois
21st-24th Nov.
To study distribution tech- niques and to meet local businessmen.
U.S.A.
Trade Mission from the Port
of Los Angeles
7
Mr. Sam YoRTY, Mayor of
Los Angeles
26th-30th Nov.
To meet prominent business-
men.
Invited by Hong Kong plastic
toy manufacturers to inspect testing facilities available in Hong Kong and to meet plastic manufacturers and representatives of the Federation of Hong Kong Industries.
To discuss the prospects of
increasing trade between Hong Kong and U.S.A. Members of the mission met His Excellency the Governor and the Director.
To increase mutual trade and to follow up some of the most promising enquiries received by the recent official U.S. Trade Mission to Hong Kong, Governor KERNER met H.E. the Governor and the Director.
To have discussions with
shipping trade and civic leaders.
114
Origin
Belgium
Name
Belgian Textile Delegation
(composed of members of the Federation of Belgium Textile Industries.)
U.S.A.
Georgia Trade Mission
Zambia
No. of Delegates
Leader of Delegation
APPENDIX 11-Contd.
Duration of Visit 1965
10
Mr. Edouard LEFEBVRE
(Managing Director of Filature Philippart S.A.)
7th-10th Dec.
5
Mrs. Virginia ALLGOOD,
Director of International Service of the State of Georgia
7th-12th Dec,
1
14th-17th Dec.
Mr. Andrew MUTEMBA,
Resident Minister of the Western Province of Zambia
Philippines
Zambia.
Philippine Trade Mission
Zambian Trade Mission
11 Mr. Clemente C. ABELLA
1966
10th-13th Jan.
5
Mr. W. HARRINGTON
16th-18th Feb.
Reason for Visit
To establish business contacts
and to study the techniques and methods used in the local textile industry.
To encourage mutual trade and explain Georgia port facilities and tourist attractions.
Invited by the Public Relations
Joint Committee of the
Hong Kong General Cham- ber of Commerce and Federation of Hong Kong Industries.
To increase mutual trade.
To explore the possibility of
purchasing more goods from Hong Kong.
To survey the market and meet
local businessmen.
Italy
Turin Trade Mission sponsored
by the Turin Chamber
21
Cav. del Lav. Dr. Giovanni
17th-20th Feb.
of Commerce
Maria VITELLI, President of the Turin Chamber of Commerce
Spain
Buying Mission
3
Sr. Alberto LUCAS
1st-6th March
U.S.A.
Iowa Trade Mission to the
Far East
92
Mr. Harold E. HUGHES,
Governor of Iowa
5th-9th March
U.K.
Leicester and County Chamber
of Commerce Trade Mission
7
Mr. H. G. A. Ross-WILSON
6th-11th March
Argentina
Argentine Trade Mission
14
Dr. M. A. Z. ORTIZ, the
Argentine Foreign Minister
20th-21st March
To meet businessmen and inspect local products.
To increase mutual trade.
Governor Hughes met His Excellency the Governor.
A selling mission arranged to
coincide with British Week.
To discuss mutual trade.
:
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