工商業管理處年報 Commerce and Industry Department Annaul Report 1969-1970

MARINE DEPARTMENT LIBRARY

ANNUAL

DEPARTMENTAL

REPORTS

KONG

1969-70

·HKS

c73

DIRECTOR OF

3145

$145

COMMERCE AND INDUSTRY

HONG KONG

ANNUAL DEPARTMENTAL REPORT

BY THE

DIRECTOR OF COMMERCE AND INDUSTRY

J. CATER, M.B.E., J.P.

FOR THE

FINANCIAL YEAR 1969 - 70*

PRINTED AND PUBLISHED BY J. R. Lee, GoverNMENT PRINTER AT THE Government Press, Java Road, HONG KONG

* 1st April 1969 - 31st March 1970

3145

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$14.54 £1 (HK$1=1s. 41d.). The official rate for conversion to U.S. dollars is HK$6.06= US$1 (based on £1=US$2.40).

нк

574

COM 70

3145

81388-15K-4/71

MARINE DEPARTMENT LIBRARY

3145

CONTENTS

Chapter

1. REVIEW OF THE YEAR 1969-70.

2. COMMERCIAL RELATIONS 'E' DIVISION (EUROPE)

GENERAL

INDIVIDUAL COUNTRIES

Austria

Paragraphs

1 - 53

ཉ.

The Benelux Economic Union

56 - 58

Federal Republic of Germany

•

France

Greece

62 - 63

•

Italy

Norway

Republic of Ireland

Sweden

United Kingdom

66 - 67

69 - 70

71 - 75

COMMERCIAL RELATIONS 'R' DIVISION-REST OF

WORLD (OUTSIDE EUROPE)

INTERNATIONAL TRADE ORGANIZATIONS

General Agreement on Tariffs and Trade

(G.A.T.T.)

United Nations Conference on Trade and

Development (U.N.C.T.A.D.).

76 - 82

United Nations Economic Commission for Asia

and the Far East (E.C.A.F.E.)

84 - 85

International Cotton Advisory Committee

(I.C.A.C.)

iii

Chapter

INDIVIDUAL COUNTRIES

Australia

Canada

Indonesia

•

Paragraphs

87 - 90

91 - 94

Iraq

•

Japan.

United Arab Republic United States of America .

4. OVERSEAS OFFICES

LONDON OFFICE

BRUSSELS OFFICE.

GENEVA OFFICE

WASHINGTON OFFICE

99 - 108

109 - 115

116 123

124 - 131

132 - 135

INDUSTRY DIVISION

CERTIFICATION BRANCH

Policy

General

Fees for Certificates of Origin

Standard Certificates of Origin .

136

137 - 140

141

Commonwealth Preference Certificates

Comprehensive Certificates of Origin .

Hair Wigs .

Amendments to Foreign Assets

Regulations

•

Control

'Late' Comprehensive Certificates of Origin

Revision of C.C.O. Procedures.

Certificates of Processing.

Co-ordination of Certification Procedures with

142 - 144

145 - 146

147 148

•

149 - 151

152 - 154

155

156

157

Approved Non-Government Organizations . 158 - 160

3145

Chapter

INDUSTRY INSPECTION BRANCH

General

Inspections

Kowloon Inspection Control

Kai Tak Import Control

Industrial Surveys

Investigations

Prosecutions

Anti-Corruption Measures.

•

INDUSTRIAL DEVELOPMENT BRANCH

REVIEW OF INDUSTRY

Paragraphs

. 161

161 - 162

163 - 164

165 - 167

168

169

170

171

172

General Expansion

Steel Industry

Wig Industry .

173 - 176

•

177

179

180

181 - 185

186

187

188

•

Textile Spinning and Weaving Industries

Textile Finishing Industry

Cotton Knitting Industry

Woollen Knitting Industry

Wearing Apparel Industry Shipbreaking Industry Other Industries

INDUSTRIAL PROMOTION

Industrial Surveys

Loans for Small Industry Committee.

Water Supply to Industry.

Land and Industrial Buildings

Productivity

189 - 190

191

192 - 194

195 - 197

•

198 - 199

HEALTH AND SAFETY STANDARDS OF HONG KONG

PRODUCTS

•

Health Standards

200 - 201

202

203 - 204

•

205

•

206 - 207

208 - 209

210 - 216

Safety Standards

Minor Complaints Regarding Safety Standards. 217

Chapter

Paragraphs

Design Registry and Copyright Legislation

ECONOMIC COMMISSION FOR ASIA AND THE FAR

EAST

PREVENTIVE SERVICE AND DUTIABLE COMMODITIES

218 219

220 - 222

PREVENTIVE SERVICE

GENERAL

223 - 226

EXCISE

Hydrocarbon Oils

227

•

Adulterated Liquor

Illicit Distilling

•

Office Accommodation

PREVENTIVE OPERATIONS

228 229

230

231

Searches

Narcotics

Unmanifested Cargo

TRAINING AND ADMINISTRATION

Investigation

Training

Staff and Discipline

FOOD SUPPLIES .

DUTIABLE COMMODITIES BRANCH

Revenue from Excise Duties

(a) Tobacco .

(b) Hydrocarbon Oils

(d) Table Waters

Revenue from Licences

•

232 - 235

236 - 238

239 240

241 - 245

246 - 258

•

259 - 264

265

266 - 269

270

271

272

273

•

274 275

•

Chapter

GENERAL DUTIES BRANCH

Trade Licensing

Reserved Commodities

(a) Rice

(b) Frozen Meat

•

(d) Coal and Firewood.

TRADE COMPLAINTS SECTION

General

Mail Order Association

8. DEPARTMENTAL ADMINISTRATION

GENERAL

•

ORGANIZATION AND PERSONNEL

Change in the Structure of the Trade Officer

Grade

Establishment

•

Recruitment

•

Promotions

TRAINING

WELFARE

Welfare Fund

Sports

Paragraphs

276

277 - 281

282

•

283 - 289

290 - 292

293 - 294

295

•

296 299

300 - 301

302

303 - 304

•

305 - 308

309

•

310

311 - 315

316

317 - 318

319

320

321

322 - 327

Preventive Service Senior Officers Mess

Clerical Canteen

DEPARTMENTAL ACCOMMODATION

9. FINANCE AND STORES

REVENUE

EXPENDITURE

STORES

WELFARE FUNDS

•

vii

. 328 - 329

330 - 332

333 - 336

337

TABLES

Table

Page

Exports of Cotton Textiles Restrained under G.A.T.T. Cotton Textiles Arrangements from October 1962 to September 1970

2. Certificate of Origin Statistics.

3. Major Confiscations under other Legislation

Confiscations under the Dutiable Commodities Ordinance, Chapter 109, and Dangerous Drugs Ordinance, Chapter 134

5. Duty from Dutiable Commodities (Gross)

6. Revenue from Dutiable Commodities Licences, 1969-70 .

Trade Complaints from Overseas Companies or Individuals

Handled by the Department from 1.4.69 to 31.3.70

Commerce and Industry Department, Hong Kong,

Organization Chart

Net Revenue Collected from all Sources .

viti

CHAPTER 1

REVIEW OF THE YEAR 1969-70

INTRODUCTION

HONG Kong's overseas trade continued its dynamic expansion in 1969. The value of domestic exports reached a new record level at $10,518 million, an increase of 24.8 per cent over 1968 and more than doubling the figure for 1965. Re-exports, which represented 20.3 per cent of total exports, increased by 25.1 per cent over 1968 and were valued at $2,679 million. Further advances were made in the U.S. market and sales to the Federal Republic of Germany, Japan, Britain, Canada, the Republic of Vietnam and Sweden also increased. Decreases were recorded again in exports to Indonesia and also to the Philippines and Kenya. Considerable gains were recorded in sales of clothing, wigs, toys, artificial flowers, electrical machinery, transistor radios and electronic parts and textiles, whilst improvements were also achieved in the export of metal manufactures, scientific instruments, photographic and optical goods, watches and clocks and tropical fish.

2. Imports continued on an upward trend in 1969, reaching a new record of $14,893 million and increasing 19.4 per cent over the previous year. Japan continued to be Hong Kong's principal supplier, followed by China, U.S.A. and Britain.

3. Commercial relations in 1969-70 were over-shadowed by growing protectionist pressures in the United States, the market for over 40 per cent of Hong Kong's exports. By the end of the period advocates of legislative action in the U.S.A. were preparing to promote a Bill to impose mandatory import controls.

4. The transitional period for the European Economic Community came to an end in December and during the following month discussions were held with the Community concerning the future of Hong Kong's cotton textiles arrangements with members. New agreements which had been reached with Germany and the Benelux countries regarding exports of cotton textiles towards the end of 1969, received the approval of the E.E.C. Council of Ministers.

5. Restraint agreements were reached with the Governments of Sweden, Norway, Canada and Australia concerning mainly Hong Kong exports of garments.

6. The considerable industrial expansion during the year led to a general shortage of labour and to improvements in wage levels. Industrialists looked increasingly to modern production methods and imports of machinery rose to a record level with the unit cost of machines also rising significantly.

7. The Loans for Small Industry Committee completed its work in March, and its Report and recommendations were endorsed by the Trade and Industry Advisory Board later that month.

EXTERNAL COMMERCIAL POLICY

8. Early in 1969 President NIXON had restated his campaign pledge to do something about the 'serious problem' facing the U.S. textile industry as a result of rising imports of man-made fibre and wool goods. In May Mr. Maurice STANS, U.S. Secretary of Commerce, visited Hong Kong, in the course of his Asian tour to explain the administra- tion's policy in this regard. Mr. STANS' visit to Hong Kong was no more productive than those he made to other countries and, apart from a further exchange of views at a special meeting in Geneva in October, there was no further direct contact with the United States regarding non-cotton textiles. The focus of American attention swung to Japan. By the end of March, however, no significant progress had been made and the advocates of legislative action in the United States were gathering their forces to promote a Bill imposing mandatory import controls.

9. In Hong Kong's second largest market, the United Kingdom, the major event of the year was the announcement by the President of the Board of Trade in July 1969 that the British Government proposed to introduce tariffs on imports of cotton textiles from the Commonwealth with effect from 1st January 1972, at the same time removing quotas from these imports.

10. Following this announcement a detailed assessment of the likely impact of this move on Hong Kong trade was begun and a Committee of the Textile Advisory Board was appointed to assist in the task. With their advice and assistance, the department drew up a very detailed

questionnaire which was subsequently addressed to nearly 2,000 firms thought to be involved in the trade. For a period of about three months at the end of 1969 and the beginning of 1970, a field staff of over 20 officers visited all the companies addressed to assist them in the comple- tion of the questionnaires. At the end of the period under review, the product of this survey was being tabulated and assessed.

11. The end of 1969 saw the end of the 'transitional period' for the E.E.C. but although in fact tariffs between member states had been eliminated and a common external tariff erected some 18 months earlier, it had proved impractical to harmonize all Community policies by the end of the year. One consequence of the ending of the transitional period, however, was that Hong Kong could no longer enter into bilateral agreements with individual member states as had been done for some years past for exports of cotton textiles to Germany and the Benelux countries. Indeed the agreements negotiated with Germany and the Benelux towards the end of 1969 had to receive the special approval of the E.E.C. Council of Ministers, because they were to cover a period beyond 31st December 1969.

12. By the end of January 1970 the first discussions with the E.E.C. Commission (representing the Six), concerning the possible future of our cotton textiles arrangements had been held.

13. When the G.A.T.T. Cotton Textiles Committee met in the autumn of 1969, the current Arrangement had only one year to run. It was obvious that there was no real possibility of an early return to free trade in this sector and the consensus gradually emerged, which Hong Kong supported, that the Arrangement should be extended for a further three years from the 5th October 1970.

14. During the year negotiations were concluded on trade in cotton and certain non-cotton items with Sweden, Norway, Canada and Australia. With the advice of the Textiles Advisory Board, quota control schemes were devised and implemented for all the restraint agreements. With the assistance of the overseas offices in London, Brussels, Geneva and Washington the department maintained a watch on, and participated in, the many activities of such bodies as the G.A.T.T., the Organization for Economic Co-operation and Develop- ment (O.E.C.D.) and United Nations Committee on Trade and Develop- ment (U.N.C.T.A.D.); and dealt with numerous other lesser problems in the field of commercial relations. All in all it was a very full year.

CERTIFICATION OF ORIGIN

15. The system under which the Commerce and Industry Department, together with four approved non-Government organizations, the Hong Kong General Chamber of Commerce, the Indian Chamber of Com- merce, the Federation of Hong Kong Industries and the Chinese Manu- facturers' Association, issues certificates of origin of one kind or another to facilitate the import of Hong Kong products into other countries continues to be of very great economic significance. These certificates are protected in law and any factory for whose products they are required must be legally registered with the department and subject to periodic inspection to ensure that the products concerned were made by the registered factory. The department employs over 200 officers in administering the system and maintains close working liaison with the four approved non-Government organizations through a non-statutory committee known as the Certification Co-ordination Committee.

16. During the year, the certificate issuing organizations continued to improve the standardization of origin criteria, documents and issuing procedures. 201,919 certificates were issued by these organiza- tions supporting an estimated 27% of all exports of domestic products. It is believed that the co-ordinated system is unique, and that no other country devotes as much effort to the maintenance of an efficient origin certification system. No difficulty was experienced during the year in ensuring acceptance of approved certificates in overseas markets.

Expansion of Industry

INDUSTRIAL DEVELOPMENT

17. By any standard, industrial expansion in Hong Kong during 1969-70 must be considered satisfactory. Exports of domestic products increased in value by 23.6% over the previous year and employment in industry was recorded at 568,787 at the end of March 1970, compared with 523,945 a year before, an increase of 44,842 people employed or nearly 9% of the March 1969 work force.

18. Despite this massive increase in employment and output, it is clear that a general shortage of labour, particularly of female workers, is being felt across virtually the entire range of industry, and that this has inhibited to some extent the full growth which overseas demand for Hong Kong products would permit. At the same time, pressure on

labour has advanced wage levels at a somewhat higher rate than experienced in previous years. This, in turn, has caused manufacturers to look carefully at the possibility of increasing the efficiency and pro- ductivity of their factories by greater mechanization and the employ- ment of modern productivity techniques.

19. Imports of machinery in 1969 were very substantially greater than for any previous year and the unit cost of imported machines also rose significantly indicating increased potential productivity. Increasing attention is being paid by industry to the need to improve product standards. Many manufacturers are also diversifying their product ranges and a greater number than ever before are investigating market trends and consumer preferences. There is a refreshing concern with design and packaging improvements and the department has supported the work of the Hong Kong Industrial Design Council and the Hong Kong Packaging Council, in these related fields.

Loans for Small Industry Committee

20. This Committee, composed of bankers, industrialists and Government officers, was appointed by the Trade and Industry Advisory Board in May 1968 to consider the possible need for improved loan services to small scale manufacturers for the purchase of machinery and equipment. A number of detailed industrial surveys were carried out by the Industrial Development Branch to provide the Committee with information on industrial financing and on problems being experienced by small scale manufacturers.

21. The Committee completed its final report in March 1970. This was subsequently endorsed by the Trade and Industry Advisory Board and, by the end of the year under review, preparations were being made for its circulation to commercial and industrial institutions, the two Universities, and the press, for their comments on its recommenda- tions.

Industrial Investment Promotion

22. The promotion of foreign participation in Hong Kong industry is an important function of the Industrial Development Branch. Potential investors are assisted by the provision of detailed information on all aspects of the economy likely to be of interest to them. Many are directly assisted to find suitable sites or premises and are helped wherever possible to iron out teething difficulties once they commence

operation. A new edition of the publication 'Industrial Investment Hong Kong' was prepared by the branch and published by the Trade Development Council.

23. A 1968 survey done by the Industrial Development Branch showed that 115 industrial undertakings in Hong Kong which were either fully or partly owned by foreign interests, employed over 8% of all workers in manufacturing industry and were responsible for over 15% of all exports of domestic products. A further survey was in process at the end of March 1970, to re-examine the extent of foreign investment in industry. The department was also holding discussions with the Trade Development Council with a view to extending the service offered to potential investors.

Steel Industry

24. The steel industry experienced serious difficulties during the period 1966-68, during which an appeal was addressed to Government by the industry for some form of protection against imports of low cost steel. Government on the advice of the Trade and Industry Advisory Board and with the concurrence of the Governor in Council, eventually rejected this appeal on the grounds that the measures requested would not assist the industry to any great degree.

25. A substantial improvement in the fortunes of this industry has now occurred, deriving from a reduction in its production capacity, an increase in demand for its products arising from a resurgence of building activity, and reduced imports of steel from other countries. A survey carried out by the Industrial Development Branch in early 1970 supported the contention that the short term prospects, at least, are very good.

Industrial Premises and Rents

26. During the latter half of 1969, demand for additional floor space by expanding industry caused a substantial upward movement in rents for industrial premises. This brought complaints from industrialists and requests that Government consider establishing legislative means by which excessive rent increase demands could be made subject to legal arbitration. The Trade and Industry Advisory Board discussed this matter on several occasions.

27. In order to assess with some accuracy the general trend of industrial rents over a period of several years, the department carried

out a field survey of nearly 500 rented flatted factory premises and made the survey reports available to the Federation of Hong Kong Industries for assessment. The report by the Federation indicated a general, but not alarming, rise in industrial rents. There were many instances of substantial proportionate increases (in some cases over 200%) but, in general, these were in respect of rentals negotiated in 1966 and 1967 when supply far exceeded demand and low rentals were the order of the day.

28. Towards the end of 1969, the Industrial Development Branch carried out a survey to ascertain the supply of additional floor space that would become available to industry resulting from new building construction. This showed that over 14 million square feet of new floor space will become available during 1970 and 1971, a 16% increase over the floor space in use at the end of 1969.

PREVENTIVE SERVICE AND REVENUE

Preventive Measures

29. The illegal removal of markers from industrial diesel oil, long a problem in Hong Kong, was observed to be on the increase during the first quarter and a loss in revenue amounting to several hundred thousand dollars a month was revealed. A full scale campaign was mounted against this illegal trade and as a result it was virtually eliminated. Revenue collections from this sector immediately increased sharply and were maintained. Illicit distilling continued to be a major problem but less so than in previous years. Adulterated liquor manu- facturers were particularly active this year and special teams were formed to track them down.

Narcotics

30. Direct action taken to prevent the importation of dangerous drugs by sea included the searching of 1,555 ocean-going vessels. Forty-three persons were arrested.

Review of the Preventive Service

31. The biennial review of the Preventive Service was held on the 20th December 1969. Over three hundred officers took part in the parade and a large number of guests were present. The Commissioner in his address mentioned the introduction of the new grade of Principal Revenue Officer and the appointment of a Chief Preventive Officer to

the post of Assistant Director, demonstrating how career prospects generally had improved in the Service. The parade marked the 60th anniversary of the appointment of the first revenue officer in 1909.

Dutiable Commodities Revenue

32. Net revenue collected from dutiable commodities during the financial year was $374,345,000, a remarkable increase of $28,845,000 over the original estimate of $345,500,000 and an increase of 11.4% compared with the previous year. There was a general increase in revenue collection from all items with the exception of Chinese prepared tobacco and locally distilled Chinese type liquor. The decrease in revenue from Chinese prepared tobacco is attributable to a gradual change in smoking habits whilst keen competition from imported liquor from China resulted in decreased revenue from its local counterpart. The long hot summer in 1969, coupled with successful advertising campaigns by commercial firms, boosted consumption of table waters and brought an increase in revenue which amounted to $1.2 million over the estimate for this commodity.

MISCELLANEOUS

Rice

33. The world rice situation was generally one of surplus supply as a result of improved harvests in most producing countries and as efforts towards self-sufficiency in most importing countries were in- creasingly successful. The surplus was generally better than that of the previous year and it precipitated keen competition among rice- exporting countries in the form of reductions in export premium (export tax) and increase in subsidized sales and exports on concessional and special terms.

34. World rice prices generally registered a significant decline. As a result local import prices for Thai rice were lower than the previous year's levels. China rice prices also reacted downwards. Local wholesale prices followed this trend and the improvement was reflected in the better quality of rice sold by retailers.

35. The successive reductions in the Thai export premium during the latter half of 1969 and the early part of 1970 had an unsettling effect on the market, as importers of Thai rice experienced some difficulty in reducing their old stocks purchased at high prices, but this was achieved without any significant effect on local prices. For the greater part of the year rice stocks were held at about 75,000 tons.

36. Per capita rice consumption, which had been on a declining trend for some years, appeared to have reached a platform.

Legislation

37. Appreciable headway was made in the major revision of the Importation and Exportation Ordinance, Cap. 50, administered by the department. The draft Import and Export Bill consolidates, in one piece of legislation, laws on import and export controls promulgated under a number of different ordinances. Following consultations with the principal trade organizations, interested government departments and the Trade and Industry Advisory Board, on the 17th March 1970 the Governor in Council ordered that the Bill be introduced into Legislative Council.

Ad Valorem Charges on Trade Declarations

38. These charges (at a rate of 0.05% ad valorem) are levied under the Importation and Exportation (Registration of Imports and Exports) Regulations, which are administered jointly by the Census and Statistics Department and this department. The revenue thus collected on trade declarations during the year amounted to $14.38 million, of which $1.34 million was notionally credited to the cost of compiling the trade statistics by the Census and Statistics Department, and $13.04 million notionally appropriated in the subvention to the Trade Development Council in the Estimates approved for the 1969-70 financial year.

Senior Staff Changes

ADMINISTRATION

39. There were five major changes in the senior management of the department during the year. Mr. D. H. JORDAN, M.B.E., Administrative Officer Staff Grade B2, Deputy Director (Commercial Relations), acted as Director during the absence, on vacation leave, of Mr. T. D. SORBY, from early April to early September 1969. Mr. D. J. C. JONES, Counsellor (Hong Kong Affairs), United Kingdom Mission, Geneva, acted as Deputy Director (Commercial Relations) from 1st June 1969 to 27th August 1969.

40. Mr. E. I. LEE, Administrative Officer Staff Grade B2, Deputy Director (Administration and Industry), left Hong Kong on vacation. leave in November 1969. The post remained vacant until the arrival of Mr. F. K. LI, Administrative Officer Staff Grade B2, in early January 1970.

41. Mr. E. P. Ho, Administrative Officer Staff Grade C, was appointed as Deputy Director (Commercial Relations) in place of Mr. JORDAN, who proceeded on leave in February 1970. Mr. L. W. R. MILLS, Principal Trade Officer, acted as Assistant Director vice Mr. Ho.

42. Mr. A. L. TOKLEY, Chief Preventive Officer, was promoted to Assistant Director and Assistant Commissioner of the Preventive Service in September 1969.

Establishment

43. At the beginning of the year the department's authorized establishment stood at 1,487 posts of which 894 were in the Preventive Service. On 31st March 1970 the overall establishment had reached 1,561, the number of posts in the Preventive Service having increased to 954. There were 118 vacancies, including 82 in the Preventive Service, at the end of the year.

Office Accommodation

44. Two major moves took place during the year. The Industry Inspection Branch moved from the Head Office Building of the Housing Authority at Ma Tau Kok to Tung Ying Building, Nathan Road, while the Economic Statistics Division of the Census and Statistics Depart- ment vacated the Fourth Floor of Fire Brigade Building. This latter move brought with it a considerable easing of the over-crowded conditions on the other floors.

45. Planning work for the renovation of the Fire Brigade Building continued and costing of the Department's proposals was being under- taken by the Public Works Department at the end of the period.

46. The department acquired some additional office accommodation at Lo Wu Railway Station for use by the Preventive Service.

Advisory Board

47. The terms of reference of the Trade and Industry Advisory Board, whose Chairman is the Director of Commerce and Industry, are:

"To advise the Director of Commerce and Industry on matters other than labour affecting the Colony's trade and industry.'

During the year, the Board met on seven occasions and discussed a range of important subjects, the major ones being the Draft Import and

Export Bill, Industrial Surveys, the European Economic Community (E.E.C.) Common Commercial Policy, Preferences, Report of the Loans for Small Industry Committee and the provision of and rentals for Industrial Premises. Membership of the Board at the end of the year comprised Mr. T. K. ANN, O.B.E., J.P., Mr. J. CATER, M.B.E., J.P., Mr. M. CURRAN, J.P., Mr. P. A. GRAHAM, O.B.E., J.P., Mr. Daniel S. H. LAM, J.P., Mr. H. T. LIU, Mr. K. S. Lo, J.P., Mr. R. E. MOORE, J.P., Mr. P. G. WILLIAMS, J.P. and Mr. James M. H. Wu, J.P. The Hon. H. J. C. BROWNE, J.P., resigned from the Board in February 1970, after having served on it since 1967.

48. With the approval of His Excellency the Governor, a Textiles Advisory Board was established on 1st April 1969 in place of the former Cotton Advisory Board. The new board has the following terms of reference:

"To advise the Director of Commerce and Industry on any matter, other than labour matters, which affects the textile and garment industries.'"

The Director of Commerce and Industry is also Chairman of this Board. Members during the year were Dr. the Hon. Sir Sik-nin CHAU, C.B.E., J.P., the Hon. S. S. GORDON, C.B.E., J.P., Mr. R. P. PARCELL, M.B.E., Mr. Lam Kun-shing, J.P., Mr. Francis Y. H. Tien, J.P., Mr. Y. L. YANG, J.P., Mr. CHEONG Ying-chan, Mr. C. K. CHOW, Mr. Frank H. LIN, Mr. Y. T. Loo, Mr. H. J. SHEN, Mr. Y. C. WANG, Mr. David Z. D. Woo, Mr. Woo Ping and Mr. William T. L. YAO.

49. The Board met 22 times during the year, concerning itself particularly with advising on the conduct of negotiations and the imple- mentation of international agreements. A number of members accom- panied official delegations overseas on several occasions.

50. I should like to express my gratitude to the members of these two boards for sparing so much of their valuable time to considering the many papers referred to them and for making their advice available on so many topics of importance during the year.

Acknowledgements

51. I am pleased to record the continuing co-operation which the department has received from trade and industrial associations, partic- ularly the Hong Kong General Chamber of Commerce, the Federation of Hong Kong Industries, the Chinese Manufacturers' Association of Hong Kong and several associations connected with the textile

industry. The department has continued to work closely with the Trade Development Council whose staff, both overseas and in Hong Kong, have helped to strengthen this fruitful association. Once more my staff assisted the Chinese Manufacturers' Association of Hong Kong to plan and arrange their annual exhibition of Hong Kong products which was held in December.

52. I also wish to thank the permanent missions of overseas countries for the continued assistance rendered to the department and particularly those which facilitated consultations and negotiations with their govern- ments during the year.

53. The period under review saw a continued rapid expansion of industrial capacity and of trade which involved the department in increased responsibilities. These were willingly accepted by the staff, both civilian and uniformed, and I wish to thank them all for their co-operation and hard work. The succeeding chapters of this report and its appendices provide an account of their efforts.

121

CHAPTER 2

COMMERCIAL RELATIONS ‘E' DIVISION (EUROPE)

(see also, Chapter 1, paragraphs 9-14)

54. While mainly concerned with Hong Kong's external commercial relations with European countries, the Division also has overall responsibility for the procedural and legal aspects of the licensing of textiles exports. During the year the draft Export (Quotas and Exports Authorizations) Regulations to be made under the new Import and Export Ordinance were brought to an advanced stage of preparation. These regulations represent a codification and improvement of various sets of regulations under which the department administers textiles controls through quota and export authorization schemes. Draft Export Licences (Textiles) Regulations were also in preparation to replace the Exportation (Cotton Manufactures) Regulations.

INDIVIDUAL COUNTRIES

Austria

55. The anti-dumping legislation applicable to Austrian imports of woollen knitted outerwear from Hong Kong and certain other suppliers remained in force. The Austrian Government has yet to ratify the G.A.T.T. Anti-Dumping Code of July 1968.

The Benelux Economic Union

56. In the restraint period 1st July 1968 to 31st December 1969 utilization of the quota under the agreement covering all cotton textile (excluding yarn) exports to the Benelux amounted to approximately 83% of the effective restraint limit.

57. In May 1969 agreement was reached regarding the treatment outside the quota arrangements of exports of grey fabrics to the Benelux for processing and subsequent re-export to countries other than the E.E.C. and its associated territories. By the end of March 1970 export licences for 250 metric tons of grey fabrics had been issued under this agreement.

58. In November 1969, at the request of the Benelux Governments, negotiations were held in The Hague on exports of Hong Kong cotton textiles to the Benelux countries. These negotiations resulted in the Agreement concluded in 1968 being extended for twelve months to 31st December 1970. The extension provided improved export opportu- nities for Hong Kong. The total quantity agreed for 1970 was 2,450 metric tons.

Federal Republic of Germany

(a) Woollen Knitted Outerwear

59. In June, the Consul-General of the Federal Republic notified the Department that the Federal Government was prepared to allow the Hong Kong/West Germany Agreement on Hong Kong's exports of woollen knitted outerwear to lapse immediately (it had been due to expire on 31st December 1969). The Hong Kong Government wel- comed this move.

(b) Cotton Woven Textiles

60. In the third restraint period (the calendar year 1969) under the agreement for the control of exports to West Germany, quota utiliza- tion amounted to over 97% of the effective restraint level.

61. At the request of the Federal German Government negotiations were held in Hong Kong in October 1969 between representatives of the Federal Republic of Germany and the Hong Kong Government. These negotiations resulted in the Agreement concluded in 1967 being extended for a period of nine months to 30th September 1970. The coverage of the extended agreement was reduced from six to five groups of cotton woven textiles, while export opportunities in the groups remaining under restraint were increased.

France

(a) Cotton Textiles

62. Talks were held in Paris in January 1970 concerning 1969-70 restrictions on certain items of cotton textiles, the import of which from Hong Kong into France is severely restricted. The French delega- tion advised that their Government had decided, as in previous years, to split the 1969-70 import quota into two equal parts, one part to be partially administered by the department in Hong Kong and the other by the French authorities. Despite this apparent concession, however, the

complications of the French licensing system resulted in considerable under-utilization of the negligible quotas available.

(b) Other Import Restrictions

63. Other French imports from Hong Kong, which are still subject to discriminatory import restrictions were also discussed at these talks. The French Government notified the liberalization of three items— namely, handkerchiefs other than of cotton; footwear with textile uppers and rubber or plastic soles; and mounted camera lenses and prisms. The remaining quotas were increased by 1.12 million francs, plus in- creases of 10,000 units for umbrellas and 3,000 units for radios.

Greece

64. The Greek Government maintains a ban on the import of most textiles from Hong Kong. This is contrary to Greece's most-favoured- nation obligations to Hong Kong under the G.A.T.T. Despite a number of formal exchanges the matter remained unresolved.

Italy

65. The Italian authorities charge fees for the consular endorsement of Hong Kong certificates of origin. The Hong Kong view that this is contrary to Article VIII of the G.A.T.T. has been brought to the attention of the Italian Ministry of Foreign Affairs. The department is awaiting a response.

Norway

66. In 1968, an Agreement was concluded between the Norwegian and Hong Kong Governments whereby the Hong Kong Government agreed to restrain the export of certain textile items to Norway. In the 12 month restraint period ending 30th September 1969, utilization of cotton garment quota amounted to 83% of the restraint limit and utilization of women's and girls' woollen and acrylic knitwear quota amounted to 94% of the restraint level; but in non-cotton blouses only just over 50% of the restraint limit was utilized.

67. In September 1969, negotiations took place in Oslo between representatives of the Norwegian Government and the Hong Kong Government. As a result, Hong Kong undertook to continue the restraint on exports to Norway of certain cotton garments and woollen and acrylic knitwear for a further period of twelve months from 1st

October 1969 to 30th September 1970. At the same time Hong Kong also agreed to institute a system of export authorizations for two other categories of cotton and four other categories of non-cotton garments for the same period.

Republic of Ireland

68. The Irish Government maintains discriminatory quota restric- tions on the imports of certain textile items from Hong Kong. Despite a number of formal exchanges, the issue remains unresolved.

Sweden

69. Exports to Sweden of certain cotton garments and towels and non-cotton garments are subject to restraint arrangements. In the 12-month restraint period ending 31st May 1969, utilization of the agreed quota for cotton garments amounted to about 84% of the restraint limit. In the restraint pericd for twelve months to 30th June 1969, shipments of non-cotton garments reached 98% of the limits established for these items.

70. As a result of consultations held in Hong Kong and Stockholm in April and June 1969 respectively, Hong Kong agreed to extend restraint on four groups of cotton garments and towels and certain non-cotton garments to 30th June 1970. At the same time Hong Kong also agreed to institute a system of export authorization for eight items of cotton garments and made-ups and three categories of non- cotton garments for the period 1st July 1969 to 30th June 1970.

United Kingdom

(a) Cotton Textiles

71. Export performance in all groups was maintained at a high level. At the end of the year there remained small unshipped balances of quota in the cotton yarns and miscellaneous cotton manufactures groups, but the piecegoods and made-up garments allocations were fully utilized. Use was also made of the anticipation provision in the agree- ment and, by 31st December 1969, 0.709 million square yards of the 1970 quota had been shipped.

72. In 1969 and the first quarter of 1970, the High Hong Kong Cost Content Schemes for finished piecegoods, made-ups and garments were operated as previously. However, demand for the yardage avail- able was lower than in previous years, and in 1969 significant amounts

of yardage remained unallocated under both schemes. On the advice of the Textiles Advisory Board, the unused yardage was made available to the trade by means of a special shipment scheme at the end of October 1969.

73. In July 1969, the British Government announced that, with effect from 1st January 1972, imports of cotton woven textiles from Common- wealth countries, which at present enter Britain duty-free, would be subject to the tariff at 85% of the full rate. At the same time all quota restrictions would be removed. A special committee of the Textiles Advisory Board was established to study the likely effects for Hong Kong and a report of its findings was nearing completion at the close of the year.

(b) Britain and the European Economic Community

74. Close attention continued to be given to developments in the European Economic Community and especially to the implications for Hong Kong of Britain's application to join.

75. In October, Her Majesty's Government announced the extension of the import deposit scheme for a further year from 4th December 1969. The rate of deposit was reduced from 50 to 40 per cent but the repay- ment period of 180 days remained unchanged.

CHAPTER 3

COMMERCIAL RELATIONS 'R' DIVISION-REST OF WORLD

(OUTSIDE EUROPE)

INTERNATIONAL TRADE ORGANIZATIONS

General Agreement on Tariffs and Trade (G.A.T.T.)

(a) Cotton Textiles Arrangement (C.T.A.)

76. The Cotton Textiles Committee (C.T.C.) met twice in the last quarter of 1969, in Geneva, to review the operation of the Cotton Textiles Arrangement and to consider the future of the Arrangement which was due to expire at the end of September 1970. Hong Kong was represented by the Deputy Director (Commercial Relations) and the Assistant Director, Geneva. The Committee failed to reach any definite conclusions regarding extension of the Arrangement, but agreed that bilateral consultations or negotiations should be held by the signatories on the hypothesis that the Arrangement would be extended for a period of three years. Another meeting of the Committee was scheduled to be held in the first half of 1970.

77. A schedule of restraint limits negotiated by Hong Kong under the C.T.A. (and the Long Term Arrangement which preceded it) and Hong Kong's export performance is at Table 1.

(b) Other Work of the G.A.T.T.

78. The Committee on Trade in Industrial Products had a year devoted mainly to the examination of a consolidated inventory of non- tariff barriers which it had prepared with the aid of the G.A.T.T. Secretariat on the basis of governments' submissions. The Committee also has the function of exploring possible concrete actions with a view to reducing or removing such barriers. Hong Kong's interest in this forum was being looked after by the Assistant Director, Geneva, who was briefed by the Department, and who attended as a member of the U.K. delegation.

79. The Division continued to examine the various legal and practical aspects of new anti-dumping legislation introduced by countries which

are parties to the Agreement on Implementation of Article VI of the G.A.T.T. (otherwise known as the G.A.T.T. Anti-Dumping Code).

80. A special Joint Working Group on Import Restrictions was established in January 1970 to speed up progress in eliminating quantitative restrictions. This Working Group will act as an agent of the Committee on Trade in Industrial Products, the Committee on Agriculture and the Committee on Trade and Development. It will conduct consultations on all quantitative restrictions of the developed countries.

81. The 26th Session of the G.A.T.T. Contracting Parties was held in Geneva from 16th to 27th February 1970. The Assistant Director, Geneva, attended the Session as a member of the U.K. delegation.

82. During the year an Assistant Trade Officer attended a four and a half month in-service training course on commercial policy in Geneva run by the G.A.T.T. Secretariat in collaboration with the United Nations Technical Assistance Bureau. He was the sixth officer sent by the department on this course.

United Nations Conference on Trade and Development (U.N.C.T.A.D.)

83. The subject of paramount importance to Hong Kong continued to be that of the proposed generalized scheme of preferences for exports from developing countries. There was much discussion and activity within the O.E.C.D. by the various developed countries proposing to accord preferences. Developments reached an important stage on 14th November 1969 when all the prospective donor countries submitted via the O.E.C.D. substantive documentation setting out the terms of their offers to U.N.C.T.A.D. The developing countries were then to examine and evaluate the offers; at the same time the donor countries would attempt to resolve the many differences that still existed in their respective offers. The department, through the Assistant Director in Geneva, con- tinued to follow closely the developments in this forum.

United Nations Economic Commission for Asia and the Far East

(E.C.A.F.E.)

84. A delegation from Hong Kong, led by the Hon. Sir C. Y. KWAN, C.B.E., a member of the Executive Council, attended the 25th Plenary Session of the E.C.A.F.E. which was held in Singapore from 15th to

28th April 1969. Other members of the delegation were the Assistant Economic Secretary, an Administrative Officer and a Trade Officer.

85. The Assistant Director (Commercial Relations-Regions other than Europe) and a Trade Officer attended the 13th Session of the E.C.A.F.E. Committee on Trade held in Bangkok in February 1970.

International Cotton Advisory Committee (I.C.A.C.)

86. Hong Kong was represented by Mr. David Z. D. Woo, a member of the Textiles Advisory Board, at the 28th Plenary Meeting of the I.C.A.C. held in Kampala, Uganda from 1st to 11th June 1969. Mr. Woo, who was briefed by the department, was attached to the British delegation as an adviser.

INDIVIDUAL COUNTRIES

Australia

87. In April 1969, the Australian Government requested further con- sultations regarding export restraint by Hong Kong on cotton drills, denims, dungarees and jeans. As a result of consultations held in Hong Kong in June under the terms of Article 3 of the Cotton Textiles Arrangement, Hong Kong agreed to restrain exports to Australia of cotton drills, other than grey, weighing between 6 oz. and 15 oz., per square yard from 1st July 1969 to 30th June 1970. It was also agreed that exports of other cotton drills and of all denims, dungarees and jeans should no longer be subject to export authorizations.

88. In June, as a result of a Special Advisory Authority enquiry, the Australian Government imposed temporary quantitative restrictions on all imports of knitted shirts, pending the result of a Tariff Board enquiry.

89. In December, the Australian Tariff Board was asked to enquire and report whether assistance should be accorded to the production in Australia of light-weight cotton fabrics of a kind for use as bed sheeting, pillow casing or bolster casing or for use in the making up of such goods.

90. On 1st January 1970, the Australian Government added over forty new items to the list of items granted entry into Australia at the Less Developed Country preferential rate of duty within quota limitations. In addition, a number of new items were added to the list

of hand-made traditional products of cottage industries that are accorded duty free admission into Australia without quota limitations.

Canada

91. The three-year Hong Kong/Canada Agreement on cotton woven fabrics, the one-year agreement on cotton woven apparel and towels, and Hong Kong's unilateral undertaking to restrain exports to Canada of polyester and polyester/cotton blend shirts, blouses and trousers, all expired on 30th September 1969. During the period 1st October 1968 to 30th September 1969 quota utilization varied as the following figures show:

Description

Unit

% Export performance as proportion of restraint level

Cotton woven fabrics ...

Cotton woven shirts, blouses, trousers and

nightwear

...

Cotton woven towels

...

Polyester and polyester/cotton woven shirts,

blouses and trousers

...

1968-69

sq. yd.

43.8

•

Equiv. sq. yd.

97.0

lb.

84.8

...

Equiv. sq. yd.

99.9

92. Following consultations in Hong Kong with Canadian officials in August and September, the cotton agreements were renewed for a further year. Under the new arrangements for cotton woven fabrics, the overall yardage was slightly increased and the specific limits on all particular fabrics, except for cotton towelling, were removed. The arrangements covering exports of cotton woven apparel and towels also provided for increased limits and improved flexibility. At the same time, the existing sub-limits within the apparel categories were removed.

93. Hong Kong's unilateral undertaking to restrain exports of polyester and polyester/cotton blend shirts, blouses and trousers was also extended, in time to 30th September 1970 and in scope to include shirts made from woven fabrics of polyester/polynosic blends.

94. In February 1969, the Canadian Department of National Revenue informed a number of Hong Kong garment exporters that the 'Fair Market Value' (the basis on which import duties are calculated) would be increased in the case of garments from Hong Kong by adding 45%-and in some cases as much as 60%-to the cost of production. In view of the adverse effect which this ruling would have on Hong Kong's trade with Canada, the department, with the collaboration of

the Trade Development Council, approached the Canadian authorities with a view to a reduction in the percentage mark-up. The concerted effort finally bore fruit in November 1969 when the required percentage mark-up was reduced by the Canadian authorities to about 30%.

Indonesia

95. In September 1969 and January 1970 the Indonesian Government announced tariff changes on a large number of items. The import duties on many essential items were reduced. The tariff changes were designed to encourage local industry.

Iraq

96. In July 1969, the department was informed that imports from Hong Kong had been banned. The department asked the British Embassy, Baghdad to enquire as to the reasons for the ban.

Japan

97. In December, the department received information that the Japanese Government had introduced a regulation whereby imports of certain items, mainly electrical and electronic goods but also including watch cases, were eligible for a tariff reduction if they contained Japanese raw materials or components which had been exported from Japan within one year prior to the date of import.

United Arab Republic

98. In June, the U.A.R. Consulate General in Hong Kong announced that ad valorem charges for consular endorsements on Certificates of Hong Kong Origin and commercial invoices covering Hong Kong exports to the U.A.R. and some other Arab countries had been cancelled and replaced by a fixed levy.

United States of America

99. Hong Kong's exports of cotton textiles to the United States in the fourth year of the bilateral agreement, which ended on 30th September 1969, continued at a high rate and 99.9% of the yardage available was shipped,—a total of 391.3 million equivalent square yards, including 1.5 million equivalent square yards carried over from the previous textile year which totalled 379.6 million equivalent square yards.

100. Exports during the first half of the fifth bilateral year, which runs from 1st October 1969, totalled 186.4 million equivalent square yards (45.5% of the aggregage limit). This represented a decrease of 22.6 million equivalent square yards, or 10.8%, from exports during the corresponding period of the previous year.

101. The annual review of the United States/Hong Kong Bilateral Agreement was held in Geneva in October 1969. There were no major areas of concern to either party in the operation of the Agreement and the review was, therefore, of a routine nature, discussions being mainly on classification matters.

102. The U.S. Secretary of Commerce, Mr. Maurice STANS, visited Hong Kong in May 1969 to explain U.S. concern over rising imports of textiles of non-cotton fibres and to seek Hong Kong's agreement to attend a special meeting the U.S. proposed to hold within the G.A.T.T. to discuss the problem. Hong Kong expressed its willingness to con- sult with any of its trading partners in any specific sector where there was a demonstrable case of market disruption caused by imports from Hong Kong, but could see no justification, from the information presented by Mr. STANS, for any action by Hong Kong along the lines proposed by him. Hong Kong took note of the situation as explained by Mr. STANS and assured him that it would be prepared to renew discussion at any time on the request of the United States Government. In October 1969 a further approach was made to Hong Kong and some discussion took place subsequently in Geneva.

103. In August 1969, the United States Department of Justice brought an appeal to the U.S. Supreme Court against a decision of the Court of Appeals made in March 1969 that Rule 36, promulgated by the U.S. Federal Trade Commission for the testing of imported wool products to determine the accuracy of labelling under the Wool Labelling Act, was invalid. The appeal was consequently rejected by the Supreme Court in November 1969. As the decision of the Supreme Court was final, Rule 36 cannot now be enforced.

104. The U.S. Fair Packaging and Labelling Act, promulgated by the U.S. Federal Trade Commission in 1968 and scheduled to come into operation on 1st July 1969, finally became effective on 10th September 1969, after a delay of some two months following court actions brought by American importers and retailers against its imple- mentation. For the time being, the Act, which requires certain classes of consumer goods to be appropriately labelled and marked before

entering the retail market in the U.S.A., does not affect Hong Kong's exports since the U.S. authorities are only enforcing the provisions of the Act at the retail and wholesale levels. However, the U.S. Federal Trade Commission, the enforcing agency of the Act, may eventually extend the operation of the Act to cover imports.

105. At the end of September 1969, the U.S. Government notified the G.A.T.T. that it wished to reserve its right, under Article XXVIII, to increase tariffs on certain types of stainless steel flatware in the course of the three-year period beginning 1st January 1970. In October 1969, the U.S. Tariff Commission of its own volition started an inves- tigation to ascertain to what extent imports of stainless steel flatware were competing with domestic products and the effect of these imports upon U.S. producers following the abolition of tariff quotas in October 1967. The results of the investigation were still awaited at the end of the year under review.

106. In December 1969 the U.S. Tariff Commission, at the request of the U.S. President, conducted an investigation into the economic factors affecting the use of tariff items 806.30 (any article of metal manufactured in the U.S.A. which is exported for further processing) and 807.00 (articles assembled abroad in whole or in part of fabricated U.S. components) of the U.S. Tariff Schedules. At present, import duty on articles falling under the above-mentioned tariff items is only assessed on the value of foreign materials or labour added abroad. The Tariff Commission's report was still awaited at the end of the year. The department is conducting a survey on the possible implications for Hong Kong industry principally the electronic sector, if these two tariff items should be removed.

107. In February 1970, the U.S. Customs announced that it would adopt, with effect from 8th May 1970, new criteria in determining whether imports of certain rubber footwear should be subject to customs valuation on the basis of American Selling Price (A.S.P.). Under these new rules, the applicability of A.S.P. would no longer depend on the ratio between the weight of the midsole to that of the whole shoe. Instead, such determination would take account of all other physical characteristics such as construction, quality, durability and appearance. One result of this ruling was that imports into the U.S. of rubber footwear with soles containing iron powder, which had hitherto escaped valuation on the basis of A.S.P. would, from 8th May 1970, be subject to such valuation.

108. In March 1970 the U.S. Tariff Commission, following receipt of a petition filed by the Umbrella Frame Association of America, under Section 301(b)(1) of the U.S. Trade Expansion Act of 1962, com- menced an investigation to determine whether the domestic industry had suffered serious injury as a result of increased imports of umbrellas and parts thereof (under Tariff Schedules items 751.05 and 751.20), and whether such increase in imports was related to a tariff concession granted in 1950. The U.S. Tariff Commission arranged to hold a public hearing on 2nd June 1970.

CHAPTER 4

OVERSEAS OFFICES

LONDON OFFICE

109. The staff of the Commercial Section of the London Office main- tained close liaison with Whitehall departments responsible for commercial policy on all matters of concern to Hong Kong. Reports were sent to the department on these matters and on economic develop- ments in Britain of interest to Hong Kong's business community. The Section staff undertook routine services for businessmen, including the issue of various certificates connected with Hong Kong's cotton textile agreement with the United Kingdom, and investigated complaints about the safety of Hong Kong products.

110. August saw the end of the arrangement whereby the Hong Kong Government Office in Pall Mall (as opposed to the other offices of the Hong Kong Government in London) was considered for administrative purposes to be part of the department. On August 20 Mr. P. C. M. SEDGWICK, C.M.G., was appointed the first Administrative Commissioner for the Hong Kong Government in London, and is responsible to the Colonial Secretary. On Mr. SEDGWICK's retirement ten days later, Mr. A. M. J. WRIGHT, C.M.G., succeeded him as Administrative Commissioner. The Department's Assistant Director was given the title of Assistant Commissioner (Commercial) heading the Commercial Section of the office and with authority to deal directly with the department on all 'commerce and industry' functions. The Trade Officer post, vacant since the beginning of March, was filled on 4th September by the secondment of a Trade Officer from the department.

111. Among the major issues with which the Assistant Commis- sioner was involved was the endeavour by the United States Government to secure some limitation on imports into the U.S.A. of non-cotton textiles. Initially these took the form of an initiative to secure an agreement, on lines similar to the Cotton Textiles Arrangement, covering all such textiles. The U.S. Secretary of Commerce, Mr. Maurice STANS, travelled to Europe and the Far East in April to explain his

Government's policy to his counterparts in the various capitals visited. The Assistant Commissioner attended, as an observer for the Hong Kong Government, the discussions in London between Mr. STANS and the President of the Board of Trade. The possible effects on U.S. policy of the reactions by Her Majesty's Governments both in the United Kingdom and Hong Kong to moves by other countries to restrict the import of non-cotton textiles from Hong Kong were the subject of prolonged exchanges and discussions in London throughout the latter half of 1969, as Hong Kong's restraint arrangements with Canada, Norway and Sweden fell due for renegotiation. The Assistant Com- missioner accompanied the Director to talks at the Foreign and Commonwealth Office and the Board of Trade in May and June and the Deputy Director, Commercial Relations, to a series of discussions in Whitehall in June (11-13), August (27-31), September (1-5), October (15), November (21-26) and December (1-3). He represented Hong Kong interests in further less formal discussions on other dates. At various times the Counsellor for Hong Kong Affairs in Geneva and the Counsellor for Hong Kong Commercial Affairs in Washington also took part.

112. Wider commercial policy issues were discussed in a series of meetings in November and December between His Excellency the Governor and senior officials of the Foreign and Commonwealth Office, the Board of Trade and the Ministry of Technology, and these were attended by the Assistant Commissioner.

113. Another major issue, on which the Assistant Commissioner kept the department in touch with developments, was the United Kingdom Textile Council's productivity and efficiency study which included a recommendation that the quotas on cotton textile imports be removed but, at the same time, duty free entry for Commonwealth cotton textiles be ended (see paragraphs 9 and 73).

114. The Assistant Commissioner represented the interests of the Hong Kong Government by participating in the negotiations between the Cross Harbour Tunnel Company, Costains Limited, Lloyds Bank Limited and the British Export Credits Guarantee Department on the terms of a guarantee by the latter of a loan by Lloyds Bank for the construction of the cross harbour tunnel. These negotiations were successfully concluded on 16th April.

115. The Assistant Commissioner participated in the briefing of Members of Parliament visiting Hong Kong, attended, by invitation, meetings of the Hong Kong Association Committee and of the Hong Kong Section of the London Chamber of Commerce and also attended, as a member, meetings of the Public Relations Advisory Committee and the joint Trade Development Council/Hong Kong Government Liaison Committee. He also addressed a number of meetings on various aspects of Hong Kong trade. The Commercial Section dealt with matters affecting Hong Kong's commercial relations with twenty-five countries.

BRUSSELS OFFICE

116. The Brussels Office of the Commerce and Industry Department is located in the same building as the British Embassy and the Brussels Office of the Trade Development Council.

117. During the year the office continued to fulfil its principal functions of observing economic and political developments of interest to Hong Kong within the European Common Market, in making and maintaining contact with Community officials and with representatives of the various Member States and other national governments in their national capitals and in Brussels and reporting relevant developments regularly to the department.

118. The Assistant Director was absent from the office, through illness, for several months in the early part of the year, and a Trade Officer from the London Office was, therefore, sent to Brussels to take charge. The Assistant Director returned to duty at the end of July.

119. The Director visited the office in the summer of 1969 during a tour of the department's overseas offices in Europe. On this occasion he met the British Ambassador to Belgium, and the Ambassador for the U.K. Delegation to the European Economic Community. The Executive Director, Trade Development Council also visited the office.

120. The Assistant Director visited Hong Kong in October/ November 1969 to attend textiles negotiations with representatives of the Government of the Federal Republic of Germany. In November similar textile negotiations were conducted with representatives of the Benelux Governments in the Hague. On these occasions, the Assistant Director formed part of the Hong Kong Delegation, which was headed by the Deputy Director (Commercial Relations).

121. In late January and subsequently again in late March 1970, discussions took place in Brussels with senior officials of the Commission of the European Economic Community concerning possible arrange- ments with the Community under its emerging Common Commercial Policy during any period of extension of the G.A.T.T. Cotton Textiles Arrangement (see paragraphs 12 and 13). An Assistant Director from Hong Kong and the Assistant Director from Geneva went to Brussels for both of these discussions.

122. In mid-January 1970 the Assistant Director headed a delegation to conduct discussions in Paris with French Government officials con- cerning the residual unilateral French restrictions on imports from Hong Kong of cotton textiles and certain other products.

123. During the year regular visits were paid to the Community capitals to discuss Hong Kong commercial affairs with officials of both the British and the national governments as well as with members of trade organizations and businessmen trading with Hong Kong.

GENEVA OFFICE

124. It is probably fair to say that 1969-70 was a year when com- mercial relations were dominated by almost continuous toings and froings on textiles, both cotton and non-cotton. This was no less true of the Geneva Office than the department as a whole. The G.A.T.T. Cotton Textiles Committee held two meetings in October and December 1969, to review the operation of the Cotton Textiles Arrangements and to consider whether it should be extended in time after its expiry on 30th September 1970. Although some progress was made, a final decision awaited a further meeting to be held in May.

125. The Assistant Director advised the department on developments in Geneva and followed the G.A.T.T. meetings closely as well as the various meetings concerning attempts by the U.S. Government to extend the concept of the C.T.A. to other textiles and to reach agree- ment on voluntary comprehensive restraints by the main Asian exporters of these products, including Hong Kong. He attended the meetings con- cerned in Geneva and visited London in August/September and November 1969, to take part in discussions on textiles with interested U.K. Government Departments. He also visited Brussels in January and March 1970, to participate, in company with the Assistant Director (Commercial Relations) Europe, in preliminary discussions on a possible cotton textiles arrangement between Hong Kong and the E.E.C.

126. From mid-May to end-August 1969, the Assistant Director was in Hong Kong where he assumed, temporarily, the duties of Deputy Director (Commercial Relations). During this period the Geneva Office was on a care and maintenance basis, although the main U.K. Mission kept the department in touch with major developments.

127. As stated above, the Assistant Director also visited London (on two occasions), Brussels (twice) and Paris (four times) on official business. In the course of his work he continued to keep in close touch with the main U.K. Mission in Geneva, with the Missions of other coun- tries and with the G.A.T.T., U.N.C.T.A.D. and O.E.C.D. Secretariats.

128. Visitors to the Office during the year included the Deputy Director and the two Assistant Directors (Commercial Relations) of the Commerce and Industry Department, the Assistant Director, Washington, and a number of representatives of U.K. Government Departments in Geneva on G.A.T.T. or U.N.C.T.A.D. business.

G.A.T.T.

129. The G.A.T.T. generally was also far from inactive during the year. Its main activities were concentrated on the 'Work Programme', covering trade in industrial products (an analysis of tariffs and non- tariff barriers), agriculture and the trade of developing countries. At the 26th Session in February some effort was made to move towards an early further round of trade negotiations, aimed at continuing the process of reducing the barriers to world trade. Although this initiative proved to be premature, it was agreed that the bodies concerned with the work programme should move beyond fact-finding towards seeking out areas of possible solutions and negotiations. To this end five working groups were established by the Industrial Products Committee to begin a new stage of the work on non-tariff barriers, and two of these groups met before the end of the year. Similar groups were also established by the Agriculture Committee, and a Joint Working Group was set up to make a new study of residual quantitative restrictions maintained con- trary to the provisions of the G.A.T.T. The Assistant Director followed all these developments in details, he attended the appropriate meetings and represented Hong Kong's interests from within the U.K. delegation and reported regularly to the department.

U.N.C.T.A.D.

130. In the course of the year a total of three meetings were held of the Trade and Development Board, as well as meetings of all four

major committees (Commodities, Manufactures, Financing (aid) and Invisibles, and Shipping). This continued the detailed process of political dialogue between the developed and developing countries on how to improve the position of the latter in world trade. The debate this year was dominated by the effort to thrash out the modalities of U.N.C.T.A.D.'s contribution to the Second United Nations Develop- ment Decade.

Preferences

131. The Assistant Director continued to follow U.N.C.T.A.D.'s work, insofar as it was relevant for Hong Kong, and he reported from time to time on developments. By far the most important aspect, from Hong Kong's point of view, however, was the continuing work, both in the U.N.C.T.A.D. and in the O.E.C.D. in Paris, on the establishment of a generalized scheme of preferences for developing countries in the markets of developed countries. The Assistant Director paid a great deal of attention to this subject, both in Geneva and Paris and he reported to and advised the department in detail on developments.

WASHINGTON OFFICE

132. In the course of its diplomatic activities as a section of the British Embassy, the Washington Office maintained regular contact with U.S. Government departments and other bodies, with American business organizations, firms and individuals active in the commercial relations field, and with the Embassies of countries with similar or competing interests.

133. No formal negotiations or discussions took place in Washington during the year, but the Assistant Director joined a Hong Kong team in Geneva in October 1969, for the Annual Review of the U.S./H.K. Bilateral Cotton Textile Agreement and for discussions with American officials on non-cotton textiles.

134. Visitors to the Washington Office from Hong Kong included the Financial Secretary in September and the Deputy Director (Com- mercial Relations) in November 1969.

135. The Assistant Director was absent on U.K. leave during May and June, and visited Hong Kong for two weeks in November for consultations.

CHAPTER 5

INDUSTRY DIVISION

CERTIFICATION BRANCH

Policy

136. Certificates of origin play an important role in the industrial and economic growth of Hong Kong. In a free market environment, it is essential that domestically manufactured goods are accepted by the customs authorities in overseas markets without question as to their origin. To this end, the Hong Kong Government has for many years accepted responsibility for ensuring that the Hong Kong certification system remains efficient and that certificates are issued under origin criteria and rules which take an internationally acceptable form. The Commerce and Industry Department discharges Government's overall responsibility in this field. The Certification Branch of the department issues Standard Certificates of Origin, Commonwealth Preference Certificates (for goods exported to Commonwealth countries under claim to duty preferences) and Comprehensive Certificates of Origin (for exports of certain categories of goods to the United States). The branch is also responsible for co-ordination between the five certificate issuing bodies approved by the Government as competent to issue certificates of origin of one kind or another. These organizations, between them, issue certificates for a large proportion of all exports from Hong Kong,

General

137. The Certification Branch issued 425,072 Standard, Common- wealth Preference and Comprehensive Certificates of Origin for local products, valued at $5,246 million, representing 48% of total domestic exports during the year. Compared with $4,871 million for the previous year the certified value increased by 7.7%. In addition, it was estimated that the value of local products certified by the four government approved certificate of origin issuing bodies, i.e. the Hong Kong General Chamber of Commerce, the Indian Chamber of Commerce, Hong Kong, the Chinese Manufacturers' Association of Hong Kong and the Federation of Hong Kong Industries, was approximately $2,936 million. Taking this into account, the total value of local products certified by

•

Government and the approved non-government organizations represent- ed 74% of total domestic exports. (See also paragraphs 147 and 148 below).

138. In 1969 Hong Kong's exports to its three principal markets, the United States of America, the United Kingdom and West Germany, were valued at $6,900 million. Of this quantity, 57% was supported by certificates issued by the branch.

139. As agreed in 1968 by the Certification Co-ordination Com- mittee, (see paragraph 158) comprising representatives of the department, the Hong Kong General Chamber of Commerce, the Indian Chamber of Commerce, Hong Kong, the Chinese Manufacturers' Association of Hong Kong and the Federation of Hong Kong Industries, certificates of origin are only issued for products manufactured by factories registered with the department. At 31st March 1970, the number of manufacturing establishments registered with the department for the issue of certificates was 10,344, a net increase of 1,248 or 14% over the previous year.

140. Table 2 records the number of certificates issued and the declared value of the certified goods, together with the corresponding figures for the two preceding years.

Fees for Certificates of Origin

141. Fees for applications for certificates, collected by means of postage stamps, are $10 for Standard Certificates of Origin, $35 for Commercial Comprehensive Certificates of Origin (exports of com- mercial consignments of certain categories of goods to the United States) and $5 for all other certificates. Revenue from certification amounted to $5,150,850 during the year.

Standard Certificates of Origin

142. 175,169 Standard Certificates of Origin were issued during the year, an increase of 15% over the preceding year. The declared value of goods certified was $2,547 million. The approved non-government certificate issuing bodies collectively issued 201,919 certificates with an estimated value of goods of about $2,936 million.

143. The department continued to promote acceptance by overseas customs authorities of certificates issued by the four approved non- government certificate issuing organizations in addition to those issued by the department. During the year the Seychelles, Spain and Costa Rica joined the large number of countries which accept these certificates.

144. In June 1969, the department was advised that certificates of origin endorsed to show a 50% Commonwealth content were no longer required to support Hong Kong products imported into France.

Commonwealth Preference Certificates

145. A total of 82,046 Forms E120 (Commonwealth Preference Certificates for export to Britain) were issued in support of exports to the United Kingdom valued at HK$1,255 million. Exports consigned to other Commonwealth countries and covered by 22,502 Commonwealth Preference Certificates were valued at $159 million.

146. An agreement was reached with the New Zealand Customs authorities whereby a Standard Certificate of Origin suitably endorsed by the department will be accepted in support of claims to preferential entry in respect of yarns and textile products made from certain raw materials and approved semi-manufactures. The agreement does not extend to man-made fibres and semi-manufactures, nor to clothing accessories. This represents a relaxation of certification requirements in that, previously, all exports under claim to preference were required to be supported by 50% Commonwealth-content certificates.

Comprehensive Certificates of Origin

147. The total number of Comprehensive Certificates of Origin issued was 145,355, representing a decrease of 15.7% over the previous period. This can be attributed mainly to the fact that, due to certain relaxations in F.A.C. regulations effective from 23rd January 1970, Tourist, Mail Order and Gift Plan Comprehensive Certificates of Origin were no longer needed to support such purchases.

148. The value of goods exported under all types of Comprehensive Certificates of Origin decreased by 6.9% over the previous year and reached only $1,284 million. The decline was largely due to a decrease in the value of human hair wigs exported to the U.S.A. In 1968-69, the value of such exports amounted to $230 million, but in the year ended March 1970, exports dropped to $147 million. In contrast, exports of synthetic hair wigs, which are not required to be covered by Com- prehensive Certificates of Origin, amounted to $273 million.

Hair Wigs

149. A marked feature in the wig industry was a continuing swing from human hair to its increasingly popular synthetic counterpart. The total numbers of human hair wig manufacturers and raw human hair

importers registered at the end of March 1970, were 99 and 91, com- pared with 120 and 135 respectively at the end of 1968-69. The total quantity of raw human hair imported for C.C.O. purposes, during the year was 1,427,000 lb., a decrease of 28% from the previous year.

150. To safeguard the security of the certification system for human hair wigs, the department laid down certain additional conditions to be observed by registered manufacturers of human hair wigs who were also producing synthetic wigs. Essentially, these required the maintenance of separate storage areas for raw hair stocks and finished goods, separate sets of production records, and a prohibition on the manufacture of mixed human/synthetic hair products.

151. In early 1969, the U.S. authorities expressed concern over imports of human hair wigs from Hong Kong at prices which suggested the use of unauthorized origin human hair. This led to discussions in April 1969 in Hong Kong between the U.S. and Hong Kong Govern- ments which resulted in an agreement by the Hong Kong authorities to introduce further controls into the C.C.O. procedure for raw hair and wigs. These were implemented progressively from September 1969.

Amendments to Foreign Assets Control Regulations

152. The Foreign Assets Control, U.S. Treasury Department, an- nounced that, with effect from 23rd July 1969, U.S. nationals in Hong Kong could each purchase and import into the United States for personal use without a Comprehensive Certificate of Origin a maximum of US$100 worth of certain goods of Chinese origin, previously pro- hibited. Accordingly, the department, in consultations with the F.A.C., relaxed the registration conditions of tourist shops to permit the storage and sale of Chinese goods in addition to goods manufactured locally and goods imported from countries other than North Korea and North Vietnam.

153. On 19th December 1969, the U.S. State Department announced further relaxations in the Foreign Assets Control (F.A.C.) Regulations. These eliminated completely the need for tourist, mail order and gift purchases to be covered by Comprehensive Certificates of Origin, and accordingly the issue of certificates for these types of purchases was discontinued. The effects of the relaxations on Hong Kong's overall trade with the U.S.A. are unlikely to be spectacular as, in 1969, the value of tourist, mail order and gift purchases amounted to only HK$30

million out of a total export trade covered by Comprehensive Certificates of Origin valued at HK$1,340 million.

154. The relaxations also permit U.S. firms and nationals to engage in trade in Chinese origin goods and 'presumptive-type' goods of other origin, including Hong Kong, between one third country and another, provided that the transactions are not financed in U.S. dollars, are not imported indirectly into the U.S. and are not of North Korean or North Vietnamese origin. No special certification is required. However, commercial shipments of presumptive-type goods from Hong Kong to the U.S.A. still require to be covered by Commercial or Commercial Sample C.C.O., and manufacturers registered for C.C.O. purposes must still use raw materials from approved sources.

'Late' Comprehensive Certificates of Origin.

155. In February 1970, the F.A.C. informed the department that the U.S. authorities would henceforth recognize the issue by Hong Kong of Comprehensive Certificates of Origin, subject to certain safeguards, after despatch of the goods. This was particularly gratifying as the matter had been a source of difficulty over a considerable period of time.

Revision of C.C.O. Procedures

156. During the year under review, the department, in consultation with the F.A.C., converted ten C.C.O. administrative procedures into seven legally based C.C.O. undertakings. Factories previously registered under the old procedures were re-registered under the new undertakings.

Certificates of Processing

157. A total of 1,236 Certificates of Processing were issued in respect of goods processed or assembled in Hong Kong, but which did not qualify under the established origin rules for the recognition of Hong Kong origin.

Co-ordination of Certification Procedures with Approved Non-Govern-

ment Organizations

158. The Certification Co-ordination Committee through which the department maintains close liaison in certification matters with the four approved non-government certificate of origin issuing bodies held two formal meetings in 1969. A very close degree of co-ordination had already been achieved between the five certificate-issuing bodies and

the co-ordinated certification system operated smoothly and efficiently. During the year, agreement was reached on standard origin criteria to be applied to printed matter, refrigerators, food freezers and composite manufactures made up from finished articles of differing origin.

159. A sub-committee was also set up to consider alignment of certification forms arising out of proposals made by the Working Party for Simpler Export Documents.

160. The problem of undervaluation was also reviewed and the non- government member organizations unanimously agreed to maintain their policy of endorsing commercial invoices only on receipt of corresponding applications for certificates of origin, as this measure has proved to be very successful in reducing the incidence of undervaluation in documents presented for endorsement.

INDUSTRY INSPECTION BRANCH

General

161. The Industry Inspection Branch provides an essential service within the system under which the department, in conjunction with the four approved non-Government certificate of origin issuing organiza- tions, issues various types of origin certificates. The branch is responsible for the physical policing of the complicated controls governing the registration of over 10,000 commercial and industrial undertakings for certificate of origin purposes and the issue of nearly half a million official certificates of origin and preference every year. The certification system supports nearly 74% of all exports of domestically produced goods and the integrity of the system depends largely upon the efficiency of the inspections carried out by the Industry Inspection Branch.

162. Branch officers carry out initial inspections leading to the registration of firms for certification purposes. This requires assessment of their productive capacity and their ability to comply with approved procedures; the re-inspection of registered firms to ensure their continued adherence to the conditions governing their registration for origin certification purposes; and the conduct of surprise spot-checks of individual consignments at registered premises prior to loading on board vessels and aircraft for export. As a result of these inspections, it is necessary to carry out detailed investigations where discrepancies are discovered. In some cases, investigation may lead to prosecution of a

person or firm for certification malpractice. Additionally, the department may suspend the registration of a factory for a period or, in very serious cases, cancel registration altogether.

Inspections

163. During the year, the branch completed a total of 18,435 factory and consignment inspections, excluding those carried out at the Kowloon Inspection Control examination centre (see paragraph 164). This represents a decrease of 25% from the number recorded for 1968-69. The decline is due in part to the deployment of experienced staff to field duties in connection with industrial surveys, which involved 3,694 visits to industrial undertakings as against 587 in 1968-69. Arising from the total number of inspections completed during the year, 2,179 certification and factory registration irregularities were discovered of which 471 required further investigation.

164. A breakdown of inspection figures for 1969-70 with compara- tive figures for the preceding year is as follows:

(a) Inspections

1969-70

(i) Initial Inspections for various types of C.O. ... 4,567

1968-69

4,104

(ii) Re-inspections

...

(iii) Commonwealth

Checks

3,288

6,029

Preference

Undertaking

256

476

...

(iv) C.C.O. Procedural Checks

1,564

837

(v) Textile Quota Checks ...

632

650

...

(vi) Origin Certification Consignment Checks

8,128

10,918

Total

18,435

23,014

(b) Miscellaneous

1969-70

1968-69

(vii) Industrial Surveys (No. of premises visited)... (viii) Number of paint samples drawn for deter-

mination of lead content

3,694

587

640

735

(ix) Number of pewterware samples drawn for

determination of lead content

(x) Number of transistor radio samples drawn for determination of no. of functional transistors

(xi) Number of samples of electrical appliances drawn for determination of safety standard... (xii) Number of miscellaneous enquiries, including

trade complaints

176

314

121

...

Kowloon Inspection Control

165. In addition to the field inspections reported in the preceding paragraph, the Kowloon Inspection Control situated in the premises of the Hong Kong and Kowloon Wharf and Godown Company Limited undertook the physical examination of certain categories of consign- ments. A breakdown of these inspections completed during 1969-70 as compared with those recorded for the preceding year, is as follows:

(i) Selected items under Comprehensive Certifi-

cates of Origin (Commercial) (ii) Cotton garments, made-ups and finished piece-goods exported to U.K. under the High Hong Kong Cost Content Scheme

(iii) Embroidered handkerchiefs and naperies under Standard Certificates of Origin/ Commonwealth Preference Certificates

(iv) Antiques to the United Kingdom

...

(v) Consignments of imported raw hair examined

1969-70

1968-69

21,046

24,189

3,078

3,592

919

1,963

166. Since October 1969, all certificable raw human hair has been stored under revenue lock in Godown 'A' at the Inspection Control premises. Release of consignments to importers is made under the supervision of an Industry Assistant.

167. During the year, exports of hair wigs to the United States continued on a large scale. These exports were supported by Com- prehensive Certificates of Origin and the value of such goods inspected was $146 million, a decrease of 36% from the figures recorded for the previous year. To ensure that adequate control was maintained over imported raw hair for use by hair product manufacturers exporting to the United States market, 919 consignments of imported raw hair weighing 634.5 tons were escorted from their point of entry into Hong Kong directly to the Kowloon Inspection Control by branch officers for physical examination.

Kai Tak Import Control

168. The Kai Tak Import Control was established during January 1970 following consultations between the department and the Foreign Assets Control of the United States Government. Manned by one Industry Assistant Class I and eight Industry Assistants Class II on a 24-hour watch system, its present function is to detain, escort and examine all consignments of raw hair imported for eventual manufacture

and export under cover of comprehensive certificates of origin to the U.S.A. Imports are detained at Kai Tak pending removal to the Kowloon Inspection Control under departmental escort for more detailed examination, storage and eventual issue of Local Sales certificates. Details of imports escorted and detained during the quarter are as under:

Number of aircraft attended

Number of consignments of human hair escorted from

aircraft

...

Quantity of hair imported

Industrial Surveys

...

1,628

164,928 lb.

169. During the year branch staff carried out a number of industrial surveys, in conjunction with the Industrial Development Branch of the department and the Federation of Hong Kong Industries (see paragraphs 198 and 199). These included surveys to obtain basic structural data on the glove, clock and watch and umbrella industries; an examination of the effect on the steel rolling industry of the resurgence of the local building industry; consideration of the trend of rent increases for industrial premises; and a survey of hair product manufacturers registered for comprehensive certification purposes to confirm stocks of raw hair.

Investigations

170. Throughout the year the Investigation Section was fully com- mitted in dealing with investigations into suspected certification mal- practice. Some of these investigations were initiated by foreign customs authorities. 265 detailed investigations were concluded during the year. In consequence, sixty-one factories received written warnings for infringements of their registration conditions; the registration of five was suspended for periods ranging from one to two months and two firms were removed from the certification registers maintained by the department for repeated malpractice.

Prosecutions

171. The staff of the Prosecution Section completed 369 Court actions during the period under review. These included the prosecution of 146 industrial undertakings/commercial firms/individuals for making false statements in declarations in support of applications for the issue of certificates of origin; for breaches of legal undertakings given to the department; and for contraventions of registration conditions. Total

fines imposed by the Courts in respect of actions taken during the year amounted to $303,115, more than double the amount in the previous year. A detailed summary of prosecutions undertaken during the period under review, is given below:

(i) Total actions

(ii) Persons arrested

(iii) Industrial undertakings/Commercial firms/

individuals summonsed

(iv) Total fines imposed by the Courts

1969-70

1968-69

369

256

114

•

$303,115

$143,280

Nil

(v) No. of persons sentenced to terms of im-

prisonment

...

(vi) No. of persons cautioned and bound over by

the Courts

Anti-Corruption Measures

...

172. It remains a matter for regret that despite the widespread publicity on anti-corruption measures given by the department, manu- factures continue to make offers of money to branch staff engaged on factory inspection work. In this regard, a total of 44 such reports were received from field officers as compared with 92 during 1968-69. In all cases, where necessary, the manufacturer concerned was interviewed by senior officers of the branch and asked to co-operate with the department in eliminating 'tea-money' offers.

INDUSTRIAL DEVELOPMENT BRANCH

REVIEW OF INDUSTRY

General Expansion

173. The overall growth of industry, measured in terms of industrial employment and exports of domestic products, continued at a satis- factory rate. Total domestic exports in 1969-70 were valued at HK$11,004 million representing an increase of 23.6% over exports in 1968-69. The Labour Department recorded a total of 15,285 industrial undertakings employing 568,787 workers in March 1970 compared with 12,763 undertakings with 523,945 workers in March 1969.

174. The importance of the textiles (including clothing) industry remained paramount. Exports of textile products were valued at HK$5,080 million or 46.2% of domestic exports in 1969-70. The plastics industry also retained its important place as an employer of labour and export earner. The chief products were toys and dolls, artificial flowers and foliage, and miscellaneous household articles. Exports of plastic

goods increased from HK$1,072 million in 1968-69 to HK$1,282 million in 1969-70.

175. The electronic and wig industries which had become well established during the last decade, both registered quite remarkable growth during 1969-70. Exports of electronic products increased by 45.7% from HK$621 million in 1968-69 to HK$905 million in 1969-70 and the industry retained its position as the third largest export earner. Exports of wigs were valued at HK$708 million in 1969-70 compared with HK$354 million in 1968-69, an increase of 100%. By the end of the period under review, this industry was the fifth largest exporter.

176. Other industries recording substantial growth were watches and clocks ($139 million to $177 million), umbrellas ($38 million to $52 million), and travel goods ($132 million to $147 million). These industries also appear to have very good potential for further growth.

Steel Industry

177. For a number of years, the steel industry experienced consider- able difficulties stemming from over-capacity, slackening domestic demand, increasingly severe competition from low-cost imports and de- creasing exports. In 1966, the industry appealed to Government for some form of protective assistance. After very full consideration, and on the advice of the Trade and Industry Advisory Board, the Executive Council agreed that any assistance which Government could provide was not likely to be of very much help. It seemed clear that the industry should seek to reduce its production capacity in order to become economically viable. This process, in fact, began to take place in 1968.

178. By the end of 1969, the revival of the property market in Hong Kong and the reduction of low-cost steel imports indicated an improvement in the overall situation of the industry. In order to assess the extent of this improvement and the likelihood of its continuation, the department conducted in February-March 1970 a fact-finding survey, which covered all the 24 steel mills known to exist in Hong Kong.

179. The survey indicated that the industry had a total capacity of approximately 343,000 tons a year with about 40% of this capacity in three mills permanently located in Junk Bay. While production capacity had contracted by about 16% since 1968, output in 1969 was approximately 194,000 tons representing an increase of 14% in 1968. As a result, overall utilization of capacity increased from 49% in 1968 to 57% in 1969. It appeared likely that production

would continue to increase substantially during 1970 and with it the percentage utilization of capacity on which general profitability is based. The short-term prospects for the industry are therefore good. In the longer run, however, further contraction and rationalization seems likely to be required if the industry is to become fully viable. The ability of the industry to remain competitive will to a large extend depend upon factors which are outside the control or influence of the industry itself.

Wig Industry

180. The wig industry was established in the early 1960's by a few pioneers who foresaw its potential for growth. Since then the industry has developed very quickly. Exports of hair products, which were negligible at the beginning of the decade and were valued at $8.4 million in 1964, increased to $647 million in 1969. According to records com- piled by the Labour Department, at the end of March 1970 there were 372 factories in this industry with a total employment close to 29,000. The main market was the U.S.A. which accepted 62 per cent of exports in 1969, followed by the United Kingdom, West Germany and Canada. Whereas exports in the period 1965-1968 were almost wholly made from human hair, there has been a substantial swing during 1969 and early 1970 towards the use of synthetic fibres. In 1969, 46 per cent of all exports of wigs were made from synthetic fibres. This percentage had risen to 72.7 in the first three months of 1970. Owing to very heavy demand, there was an acute shortage of suitable raw materials, viz. modacrylic fibres, by the end of 1969. These are produced by only a few manufacturers in the U.S.A., Japan and the United Kingdom. The shortage of synthetic fibres, which seems likely to continue at least through 1970, impeded the full potential growth of the industry. Never- theless, there are good grounds for believing that further substantial growth in exports of wigs and related products will occur during 1970.

Textile Spinning and Weaving Industries

181. At the end of the period under review, there were 31 (31)* cotton spinning factories registered with the department for certification purposes, employing 21,747 (20,632) workers and operating 825,916 (786,688) spindles, an increase of 39,288 spindles over the total at the end of the previous year. Production of cotton yarn was approximately 321 (325) million lb. ranging mainly from 10s to 60s counts, carded and combed in single or multiple threads.

* Previous year's figures shown in brackets.

182. While the number of spindles increased, the weight of yarns. produced showed a slight decline. This reflects the expansion of pro- duction of finer count yarns and blended cotton/synthetic yarns.

183. The production of cotton/synthetic yarns continued to increase. At the end of March 1970 thirteen cotton mills had adapted a percentage of their spindles to the spinning of polyester/cotton and polyester/ viscose yarn for weaving into shirting and other fabrics for which there was a growing demand. Total production was approximately 30 (24) million lb.

184. Production of woollen and worsted yarn amounted to 24 (21.1) million lb. Most of this yarn was utilized by the knitting sector, a small quantity being woven into cloth.

185. Production in the cotton weaving sector decreased during the year although the production capacity remained almost the same. This was due to the expanding use of loomage for weaving blended synthetic/ cotton fabrics. Total production of cotton piecegoods was approxi- mately 768 (797) million square yards and consisted chiefly of cotton grey drill, shirtings, poplin, gingham canvas and other bleached and dyed cloth and prints. At the end of March 1970, there were 186 (190) cotton weaving factories registered with the department for certification purposes, with a total of 23,189 (23,862) looms installed.

Textile Finishing Industry

186. The dyeing, printing and finishing industry concentrated on such developments as multi-colour screen and roller printing, preshrinking processes, polymerizing for the production of drip-dry fabrics and finishing of synthetic materials. At the end of March 1970, there were 224 (196) textile finishing mills employing 7,600 (8,530) workers.

Cotton Knitting Industry

187. The cotton knitting industry remained fairly static. According to records compiled by the Labour Department at the end of March 1970, there were 243 (241) cotton knitting mills employing 8,418 (9,371) workers. Products were mainly shirts, gloves and undergarments. Cotton interlock materials and warp-knitted cotton fabrics were also produced.

Woollen Knitting Industry

188. The woollen knitwear industry continued to expand. At the end of March 1970, there were 855 (591) factories in operation employing 37,266 (35,028) workers. Exports of woollen knitwear of all types,

including gloves, were valued at $816.2 million, an increase of 10.8% over the previous year.

Wearing Apparel Industry

189. Hong Kong manufactures a wide range and variety of garments including shirts, underwear, outerwear (both knitted and woven), gloves, hats, socks and stockings. This industry continued to thrive. By the end of March 1970, the industry employed a labour force of 105,169 (95,648) in 2,043 (1,662) industrial undertakings. The value of exports of clothing in 1969-70 reached $3,900 ($3,274.1) million, an increase of 19.1% over the value for the previous year.

190. The production of permanent-press garments continued to increase. As this finishing process is most successfully applied to mixed cotton/synthetic fabrics, its popularity is encouraging the use of these fabrics.

Shipbreaking Industry

191. The shipbreaking industry which is closely associated with the steel rolling industry expanded its activities during the period under review. 56 (33) vessels were broken up totalling 312,718 (158,000) gross tons. The bulk of the scrap steel obtained from these ships was con- verted by the steel rolling industry into bars and rods for the construc- tion industry. Some scrap steel and non-ferrous scrap was exported, mainly to Japan.

Other Industries

192. Other manufacturing industries which showed significant growth during the period are:

At the end of March, 1970 No. of Workers No. of Factories

Exports, 1969-70 (HK$ million)

71,801 (67,959)

2,379 (1,963)

1,282.1 (1,071.5)

37,318 (34,144)

15,952 (17,997)

46,182 (41,101)

...

3,787 ( 3,932)

1,928 ( 1,556)

926 (780) 442 (378) 2,305 (1,704) 47 ( 42) 11(11)

802.1(683.4)

389.0 ( 323.4)

590.5 (484.0)

92.0 (

84.6)

32.8 (

20.2)

29.6 (

21.8)

3,597 ( 2,875)

77 ( 53)

116.0(

75.2)

...

36,552 (31,259)

173 (114)

907.4 ( 622.9)

254.2( 149.4)

498.3 (366.4)

15.0 (

1.0)

11,471 (11,562)

48 (42)

58.6 ( 47.6)

42.3 (

47.6)

Plasticware of which

toys and dolls

...

flowers, fruits and foliage

Light Metal Products of which

torches

stainless steel cutlery

stainless steel utensils

Watches and Clocks

Electronics of which

transistors

transistor radios T.V. sets

Shipbuilding of which

...

yachts, pleasure cruisers and

other small crafts ...

193. The electronics industry, in particular, continued to grow and diversify. In March 1970, there were twelve factories producing silicon transistors and ten factories engaged in the production of computer components and sub-assemblies, nine of which were engaged in the sub-assembly of integrated circuits. The assembly of television receiving sets is a new diversification of this expanding industry.

194. The manufacture of machinery 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. Although these products were mostly sold locally, the industry also recorded useful exports during the year.

INDUSTRIAL PROMOTION

195. In order to encourage overseas investment in local industry, the Industrial Development Branch provides a comprehensive service to potential investors. This has assisted many foreign companies to set up industrial undertakings in Hong Kong. The service is being constantly improved.

196. The branch revised and reissued its industrial promotional publication 'Industrial Investment Hong Kong'. This brochure was first prepared by the department and published by the Trade Development Council in 1968. It contains a great deal of information which is normally sought by potential investors considering Hong Kong as a base for an industrial operation.

197. During the year, a number of foreign companies established industrial undertakings in Hong Kong and more were considering doing so. The department now has on record over 160 factories which are either fully or partly owned by foreign interests. These factories employ over 10% of the industrial workforce and produce over 12% of all exports of domestic products.

Industrial Surveys

198. From time to time it is necessary to obtain detailed information on particular industries in Hong Kong in order to consider problems affecting trade and industry more effectively, and the department has adopted a pragmatic system under which the information required is obtained by specialized surveys. During the year, several of these surveys were carried out to obtain information on the glove, watch

and clock and steel rolling industries. The surveys were organized by the Industrial Development Branch and the field work was carried out by the Industry Inspection Branch (see paragraph 169). The department also carried out a sample survey to obtain general information on the availability of labour for manufacturing industries in order to assess whether factory production/expansion programmes were being threat- ened by possible shortage of labour. In addition, two separate surveys, one on the machinery manufacturing industry and another on rents for industrial premises, were carried out by the department in collaboration with the Hong Kong Productivity Centre and the Federation of Hong Kong Industries respectively.

199. At the end of the year, the field work for a fact-finding survey on the umbrella and umbrella parts industry was nearing completion. Several other surveys, including one on foreign participation in local industries, were in various stages of preparation.

Loans for Small Industry Committee

200. The Industrial Development Branch has been engaged for about two years in servicing the Loans for Small Industry Committee of the Trade and Industry Advisory Board. This Committee was set up in May 1968 to consider whether a need exists for improved loan services to small scale industrialists for the purpose of buying new machinery and plant. The Committee comprises five industrialists, three bankers and three Government officials and has met altogether seven times since it was established. Very detailed information was required by the Committee on many aspects of industrial financing and the operation of small scale industry. The branch obtained the bulk of this information by means of detailed surveys involving a considerable amount of field work and evaluation.

201. In early March 1970 the Committee was able to finalize its report to the Trade and Industry Advisory Board. At the end of the same month, the report received the endorsement of the Board and consideration was being given to its circulation to various industrial and commercial associations, the Universities and the press, with a view to seeking their reactions to its recommendations.

Water Supply to Industry

202. Although the construction of the sea level reservoir at Plover Cove has substantially reduced the perennial problem of water supply

in Hong Kong, its use has created an additional problem for industry, that of salinity in the water supply. Plover Cove was constructed from a sea inlet and as a result the salt content of the reservoir floor will continue to affect the salinity level of the impounded water for many years. The reservoir is the largest supplier of water to the mains system and industry has had to accept that the general salinity level in the mains supply is likely to remain at about 300 p.p.m. for some years to come. This has required those industrialists who must use pure water to install or enlarge the capacity of deionizing equipment, or make alter- native arrangements for an external supply of non-saline water. By the end of the year, industry appeared to have adapted well to this problem.

Land and Industrial Buildings

203. During the year, a substantial increase in industrial land sales and industrial building was noted. Sixty-two industrial sites were sold in the urban area and a further forty-nine in the New Territories. Demand for industrial land kept sale prices relatively high and most developers are constructing multi-storey buildings on their sites. By the end of the year, the department had records on 115 industrial buildings under construction or about to be constructed, which would provide over 14 million sq. ft. of floor space for industry.

204. Despite this welcome development, demand for premises was substantially greater than supply for most of the year and the trend of rents was generally upward. As a result, representations were made to Government by industrialists on various Councils and Boards to con- sider the introduction of legislation which could be used to protect industry against unreasonable demands for rent increases. By the end of the year, this issue was under consideration by the Government.

Productivity

205. The relatively full employment which Hong Kong has achieved, coupled with increasing overseas demand for Hong Kong products, have placed pressure on manufacturers to utilize labour as effectively as possible and to improve their productivity. Greater mechanization and more attention to modern productivity techniques are already providing industry with good returns but much more remains to be done in this direction. Industry's concern with productivity is reflected in the increasing tempo of work within the Hong Kong Productivity Centre whose services are becoming widely known in industry.

HEALTH AND SAFETY STANDARDS OF HONG KONG PRODUCTS

206. The Industrial Development Branch continued to investigate overseas complaints concerning alleged health and safety hazards in Hong Kong products. Most of these complaints originated in Britain, where consumer protection agencies are very active. In dealing with this subject, the branch maintains a close liaison with the British Home Office, working through the London Office of the Hong Kong Govern- ment. Depending on the nature of the complaint it is also necessary from time to time to work closely with the Labour Department, the Urban Services Department, the Medical and Health Department and the Public Works Department.

207. During the year a total of twelve circular letters on health and safety were sent to manufacturers to bring to their attention the results of complaints investigated by the department and to help them improve the standards of specific products.

Health Standards

Toys-Lead Content

208. In view of the stringent requirements laid down by the United Kingdom Toys (Safety) Regulations 1967 with regard to the paints used for toys, the department continued testing samples of paints being used by toy manufacturers, to ensure that the lead content did not exceed the British statutory limit of 5,000 parts per million. During the year, 654 samples were drawn from toy factories and submitted to the Government Chemist for testing. 68 samples were found to have a lead content in excess of 5,000 parts per million and measures were taken to prevent the sale of toys coated with these paints.

209. During the year the branch received three overseas complaints alleging that Hong Kong toys were coated with paint containing excessive lead. In each case, the manufacturer undertook to ensure that suitable paints will be used in future.

Safety Standards

(a) Electrical Products

210. In recent years the Industrial Development Branch has had to deal with a number of overseas complaints about the safety standard of Hong Kong made electrical products, such as Christmas tree decora-

tion lights, plugs and table lamps. All complaints were thoroughly investigated and, the branch was able to secure the co-operation of the manufacturers concerned to improve products, which had been found under test to be faulty.

211. During investigation of these complaints the department became aware that many small manufacturers might be experiencing difficulty in working to internationally accepted standards of safety. In order to evaluate the nature and extent of the problem, the department, with the assistance of the Federation of Hong Kong Industries and the Government Electrical and Mechanical Engineer, commenced in January 1970, a comprehensive system of testing samples of electrical products drawn from factories registered with the department. These products were tested and, where the test reports showed faults in the safety standard the manufacturers concerned were interviewed and recommendations for improvements conveyed to them.

212. During the year seven complaints about electrical appliances and three about Christmas tree decoration lights were received from overseas countries and were successfully dealt with by the branch. The manufacturers concerned undertook either to improve their products or to stop production of the item.

(b) Synthetic Wigs

213. Following rather sensational reports in a leading British news- paper alleging that Hong Kong made synthetic wigs represented a serious fire risk, the branch, working with the London Office of the Hong Kong Government, carried out research and flammability tests in Hong Kong which effectively proved that most wigs exported to Britain were made from non-flammable fibres, whilst those made from flamm- able fibres burned less readily than human hair. Similar tests were carried out in London by a professional testing organization. The results of these tests were made public in Hong Kong, Britain and in other countries, providing reassurance to importers and consumers.

214. A circular was issued to manufacturers of children's wear drawing attention to the contents of a report by a British Home Office working party on children's dressing gowns. The report was concerned with the flammability of materials used in the production of this item.

50(d) Food Products

215. Complaints were received from Britain that unsatisfactory colouring matters and preservatives had been found in oyster juice and confectioneries exported from Hong Kong.

216. In order to prevent the recurrence of similar incidents, the branch issued circular letters to the trade setting out the provisions of the 'Colouring Matters in Food and Drugs Regulations' and the 'Preservatives in Food and Drug Regulations' in force in Britain.

Minor Complaints Regarding Safety Standards

217. During the year the branch received thirteen other complaints from overseas regarding the safety standard of Hong Kong products, mainly toys. Investigations into the individual cases were made and the manufacturers concerned were interviewed and all agreed to improve their products and eliminate the defects.

Design Registry and Copyright Legislation

218. The department had consultations during this year, with representatives from the Registrar General's Department and the Legal Department concerning present legislation in Hong Kong on designs registration and protection. The matter is still under consideration.

219. The branch successfully dealt with several complaints con- cerned with the infringement of registered designs and alleged false trade description of Hong Kong products; an amicable settlement was reached in each case.

ECONOMIC COMMISSION FOR ASIA AND THE FAR EAST

220. The Industrial Development Branch was responsible for briefing a three-member delegation to the 9th Session of the Working Party on Small-Scale Industries held in Bangkok from 17th to 23rd June 1969. The delegation was led by Mr. K. S. Lo, J.P., a member of the Trade and Industry Advisory Board and managing director of the Hong Kong Soya Bean Products Co., Ltd.

221. The branch briefed the two-member delegation to the 5th Session of the Asian Industrial Development Council held in Bangkok

from 15th to 21st January 1970. The leader of this delegation was the Assistant Director, Industry Division.

222. The branch also briefed a two-member delegation to the 22nd Session of the E.C.A.F.E. Committee on Industry and Natural Resources held in Bangkok from 22nd to 29th January 1970. The leader of this delegation was a Principal Trade Officer.

CHAPTER 6

PREVENTIVE SERVICE AND DUTIABLE

COMMODITIES DIVISION

PREVENTIVE SERVICE.

General

223. On 20th December 1969 the biennial review of the Preventive Service was held. Over three hundred officers were on parade and a large number of prominent citizens attended as guests. The parade also marked the 60th anniversary of the appointment of the first revenue officers.

224. Ten teams took part in the annual competition for the Luddington Shield for Efficiency. The Training/Administration team won the Shield for the second consecutive year. The first competition for the Macpherson Award for administration was held during the year and was won by the Preventive Operations-Harbour Division team. All teams displayed enthusiasm and esprit-de-corps during the two competitions.

225. Work on the new Preventive Service Headquarters, located on the 9th and 10th floors of the Rumsey Street Government Car Park, came near to completion. The accommodation is being provided for Preventive Service personnel presently working in the Fire Brigade Building, Connaught Building and the Warehouse complex at the Macau Wharf. The Dutiable Commodities Branch will also move from Fung House to the new Rumsey Street Building which will, in addition, contain Preventive Service barrack accommodation, a revenue officers canteen and the senior officers Mess.

226. Major emphasis was placed on measures to stamp out the illegal practice of removing the chemical and colour markers from industrial diesel oil for use in vehicles, but despite this, patrols con- tinued their action against the illicit distillation of Chinese type spirit. It became increasingly difficult for illegal distilling to pass undetected and many offenders, fearing the high detection rate, either discontinued their operations or moved from the urban areas to remote parts of the

New Territories and adopted more sophisticated methods of conceal- ment. The introduction of an improved scale of rewards for information concerning illicit distilling saw a marked increase in the information received from members of the public. With the continued assistance of the public it has been found possible to keep this problem under control. Seizures of Chinese type spirit totalled 2,096 gallons as com- pared with 3,750 gallons for the previous year, and seizures of ferment- ing material (intended for use in illicit distilling) totalled 106,171 gallons as against 176,077 gallons for 1968-69.

EXCISE

Hydrocarbon Oils

227. During the year Excise patrol officers increased their activities in an all-out effort against the illegal use of treated diesel oil in motor vehicles. Widespread raids, conducted throughout the Colony, resulted in the seizures of 61,253 gallons of treated and detreated oil. Action was taken against 297 persons and 14,301 vehicles were checked. On 30th June, following the reinforcement of patrols with officers from other divisions of the Service, a total of 5,000 gallons of diesel oil was seized. That these raids had the required effect is evidenced by the increase of approximately $700,000 per month in revenue collected from this commodity since August 1969.

Adulterated Liquor

228. Action was taken against 19 persons for adulterated liquor offences and 337 bottles (56 gallons) of adulterated liquor were seized.

229. The major outlets for this trade are restaurants catering for wedding parties and other large gatherings. Special units were organized to deal with this problem.

Illicit Distilling

230. Patrols continued their drive against the illicit distilling of Chinese type spirit. As a result of the pressure which was maintained by patrol officers and the high rate of detection, many operators of stills ceased operation. Another blow was delivered to this trade on 1st January, when the use of cyclamates in manufactured food and drink products was banned and factories previously using this artificial sweetener changed to brown sugar, causing a shortage of this commodity on the domestic market. The illegal distillers were obliged to use more

expensive sugars and some were dissuaded from continuing their illegal activities by the higher production costs.

Office Accommodation

231. The Excise Office located at the Tsim Sha Tsui railway terminus was vacated at the request of the General Manager of the Kowloon-Canton Railway. A new Excise Office, in the Chartered Bank Building, Tsuen Wan, was opened on 19th May and additional accom- modation for the Island Excise Station was allocated in the Causeway Bay Magistracy.

Searches

PREVENTIVE OPERATIONS

232. Preventive Service Officers searched 785 ocean-going vessels and boarded 2,108 vessels for cargo examination duties in connection with narcotics, dutiable commodities, unmanifested cargo and illegal immi- grants. Marine patrols searched 17,560 fishing and trading vessels whilst patrol launches steamed a total of 18,249 hours.

233. The Macau ferries were checked regularly and 1,210,266 in- coming passengers were processed, an increase of 16.66% over the previous year.

234. 421,198 persons passed through the Lo Wu baggage examina- tion hall as against 284,972 for 1968-69, an increase of 47.8%. Imports of cargo through this channel amounted to 561,309 tons (518,081.3 tons) and cargo passing through the Sheung Shui Sub-Station amounted to 54,467 tons (54,774 tons).

235. The number of incoming passengers at Kai Tak Airport con- tinued to rise and a total of 970,409 (786,908) passengers and military personnel were processed through Preventive Service facilities. Aircraft arrivals totalled 20,158 (17,092). Work continued on the new motorized baggage handling units, carousels and other improvements which are designed to pass up to 2,200 passengers per hour through arrival and departure formalities.

Narcotics

236. Preventive Service action in the harbour included the searching and guarding of 1,555 ocean-going vessels and the examination of incoming cargo on 2,108 vessels. A total of 81 narcotic seizures was made and 43 persons were arrested.

237. In September the vessel Tailungshan, was kept under routine observation for two consecutive nights by Preventive Service officers. During the early hours of the second night two men were observed unloading goods from the vessel into a waiting boat. The officers gave chase but before they could intercept the suspects they were seen and three tins were thrown overboard from the other vessel. The officers broke off the chase in order to retrieve the tins, which were found to contain a total of 33.6 kilogrammes of morphine.

238. 12,639 grammes of cannabis were seized. The majority of offenders were apprehended at Kai Tak Airport, although it is of interest that on 29th September cannabis was, for the first time, discovered to have been brought into Hong Kong by a passenger on board an ocean- going vessel. The offender, an Australian female, was found in posses- sion of 788 grammes of cannabis resin. She was arrested and sub- sequently fined $800.

Unmanifested Cargo

239. Several seizures were effected during the period, the majority consisting of quantities of watches and radios.

Marine

240. On 19th July 1969, the Preventive Service fleet became fully operational under Preventive Service control when C. & I. No. 5 was returned by the Royal Hong Kong Police Force. Ninety-eight marine personnel attended courses in navigation and engineering duties, and five officers attended a V.H.F. radio training course.

TRAINING AND ADMINISTRATION

Investigation

241. A total of 54 investigations, relating to a miscellany of offences under various legal enactments, were conducted by officers of the Investigation section and fourteen warrants were executed in respect of offences under the Merchandise Marks Ordinance. Only one of the warrants issued under the Merchandise Marks Ordinance led to dis- coveries giving rise to an official prosecution; in the other thirteen cases private prosecution and/or settlement followed execution of the

warrants.

242. In an endeavour to check the veracity of statements contained in a large number of import and export declarations 1,230 visits were

made to commercial organizations. During these visits the opportunity was taken to advise importers and exporters how to furnish the requisite data on the declaration forms.

243. The number of court actions totalled 4,115 and 1,162 (1,592)* summonses were issued for failing to lodge declarations under the Importation and Exportation (Registration of Imports and Exports) Regulations.

244. The following table shows the trend over the last three years:

1969-70

1968-69

Actions Arrests

Summonses

Fines

...

1967-68

4,115 421

2,210 $203,894

5,017

4,155

611

1,014

2,747

1,597

$302,194

$437,788

245. Details of major confiscations ordered by the Courts are given in Table 3, and of dutiable commodities and dangerous drugs seized in Table 4.

Training

246. The Preventive Service Training Centre continued to function at the Kwun Tong District Government Offices.

247. On 24th March 1970, Government allocated a site, of approxi- mately 250,000 square feet, at Tai Lam Chung for the building of a Preventive Service training school. The school will accommodate 113 trainees and a staff of twenty-one.

248. 140 persons were recruited into the Service and Induction Training Courses were held at regular intervals for all recruits. Four passing-out parades were held for a total of 14 Revenue Sub-Inspectors, 12 Women Revenue Sub-Inspectors and 85 other ranks.

249. The annual revolver shoot took place between 15th and 28th February at the Royal Hong Kong Police Firing Range at Smuggler's Ridge. 733 officers attended and all reached the required standard.

250. Three refresher courses for Senior Revenue Officers were held during the year.

251. Two qualifying examinations for promotion to the grade of Revenue Inspector were held and 31 officers were successful.

* previous years.

252. One Chief Revenue Inspector and four Senior Revenue Inspectors were seconded to the Colonial Secretariat for administrative duties for periods ranging from six to eight months.

253. One Assistant Chief Preventive Officer attended a meeting of the E.C.A.F.E. Committee on Trade and the Working Party on Customs' Administration in Bangkok during August 1969.

254. One Chief Revenue Inspector paid a liaison visit to Customs Services in Sabah, Singapore and Thailand in September 1969.

255. Four Revenue Sub-Inspectors attended a three week course at the newly opened Outward Bound School.

256. Preventive Service officers gave talks to Police Inspector and Immigration Sub-Inspector recruits on 'Preventive Service Organization and Functions' and 'Ship Searching Techniques'.

257. At the request of the Agriculture and Fisheries Department, Preventive Service officers ran courses lasting 3 days on arrest and prosecution procedures for Game Wardens.

258. 188 people from schools, Government departments and overseas visited the Preventive Service Training School. Among the visitors were two United States Customs representatives, the Assistant Director of Excise, Nepal, and a senior official of the East African Customs Service.

Staff and Discipline

259. Mr. A. L. TOKLEY, Chief Preventive Officer, was promoted to the post of Assistant Director of Commerce and Industry (and also Assistant Commissioner of the Preventive Service) with effect from 1st September 1969.

260. One hundred and fifty-three other officers were also promoted.

261. Commendations were awarded to: One Revenue Sub-Inspec- tor, two Senior Revenue Officers, six Revenue Officers and ten Assistant Revenue Officers for outstanding initiative and zeal displayed in the performance of their duties.

262. One Revenue Inspector, four Revenue Sub-Inspectors and three Assistant Revenue Officers transferred to other Government departments.

263. Two Revenue Inspectors, seven Revenue Sub-Inspectors, twenty- eight Assistant Revenue Officers and two Women Assistant Revenue Officers resigned from the Service.

264. Four breaches of discipline were reported during the year. Punishments awarded were as follows:

Reprimands Fines

Dismissals...

Extra duty

...

•

1969-70

1968-69

FOOD SUPPLIES

265. The work of this unit is to compile price and quantity records and statistical returns in respect of daily imports of essential food- stuffs, such as rice, swine, cattle, vegetables, fish, poultry, eggs and frozen meat. The information is used by the Food Supplies Co-ordinating Committee which keeps a watching brief on the supply of essential foodstuffs.

DUTIABLE COMMODITIES BRANCH

Revenue from Excise Duties

266. The total net revenue from duties and licence fees during the year was $378,929,000, an increase of 11.4% over that of the previous financial year ($340,186,000).

267. For comparison, net revenue figures for the year under review and the past two years are summarized below:

Tobacco Hydrocarbon Oils

...

Liquor

Table Waters

Methyl Alcohol

in $'000

1969-70

1968-69 1967-68 125,475 118,785 121,503 135,753 117,337 108,121

103,049

91,357

82,971

9,960

8,190

8,037

108

374,345

335,750

320,681

268. The figures show a marked increase in revenue from all categories of dutiable commodities. The total net revenue exceeded the original estimate of $345.5 million by $28.8 million.

269. A full breakdown of gross collections, together with refunds and drawback payments, is shown in Table 5.

(a) Tobacco

270. Net revenue from tobacco was $125.5 million, an increase of $5.5 million or 4.6% over the original estimate. Gross revenue from tobacco leaf also increased by $3.8 million while overall drawback payments were $116,000 more than those of last year. There was a sharp increase in the exports of locally manufactured cigarettes but due to the late receipt of tobacco weight reports from the Government Chemist, more than $7.0 million worth of drawback payments were outstanding by the end of March 1970 compared with only about $4.0 million at the same time last year. The revenue picture for tobacco was thus somewhat distorted. Revenue from imported cigarettes and cigars increased by $3.0 million. Collection from Chinese prepared tobacco was only $918,698, a decrease of $72,000 compared with that of last financial year. Although there was a complete absence of speculative pre-Budget withdrawals of tobacco leaf from bond by tobacco factories, the duty paid stocks of tobacco leaf at the close of the financial year amounted to 372,000 pounds, as compared with 340,000 pounds in 1968-69.

(b) Hydrocarbon Oils

271. Net revenue collected from this category was a record, exceeding the original estimate by $11.8 million and the 1968-69 figure by $18.4 million. The remarkable increase in apparent consumption of furnace oil reflected the continued growth of local industries. Revenue from this single item amounted to $40.3 million, an increase of $4.8 million over 1968-69. Revenue from diesel oil went up to $41.5 million, with consumption of $85.4 million gallons, representing an increase of 12.5% over 1968-69. This was due to the increase in the number of vehicles and intensified action against the illegal use of industrial oil. Revenue from diesel oil for road vehicles increased markedly from August by over $0.7 million a month and the increase was maintained up to the close of the financial year. As a result, net collection from diesel oil for road vehicles amounted to $32.5 million, an increase of nearly $8.0 million or 32.3% over that for 1968-69. The increased use of liquefied petroleum gas as domestic fuel brought the consumption to 48,000,000 pounds, with an increase of 29.6% in revenue from this commodity.

272. Total net revenue from liquor was $103.0 million, an increase of $11.7 million or 12.8% over that for 1968-69 and $10.3 million above the original estimate. Imported brandy and whisky accounted for nearly $7.0 million, an increase of 17.6% over that for 1968-69. Revenue collected on locally produced Chinese type liquor decreased by $2.1 million (299,800 gallons) which was offset by increased imports from China which were nearly 400,000 gallons more than the previous year.

(d) Table Water

273. The long hot summer brought net revenue from this category to $9.96 million, exceeding the estimate by $1.2 million.

Revenue from Licences

274. The revenue obtained from various types of licences is shown in Table 6. Revenue from this source was $132,000 above the estimate of $4.6 million, an increase of $148,000 or 3.3% over last year.

275. Net revenue from licences issued in respect of various com- modities is shown below together with comparative figures for the previous two years:

Liquor

Tobacco

...

Hydrocarbon Oils

Table Waters

Ship and Harbour Vessels

Methyl Alcohol

in $'000

1969-70

1968-69

1967-68

3,487

3,322

3,127

861

.884

851

...

198

195

194

...

4,584

4,436

4,206

CHAPTER 7

GENERAL DUTIES BRANCH

276. This Branch, which was established in February 1969, is responsible for licensing controls, strategic and reserved commodities and food supplies, the co-ordination of departmental legislation, reports and other subjects which do not fall readily into any existing division or branch. The Trade Complaints Section, formerly in the Industrial Development Branch, was also placed under the control of the General Duties Branch in August 1969.

Trade Licensing

277. The Importation and Exportation (Southern Rhodesia) Regula- tions, continued in force throughout the year. These Regulations, which subject all imports from and exports to Southern Rhodesia, to licensing control, were introduced in May 1966 in conformity with the policy of the United Kingdom Government in respect of sanctions against Southern Rhodesia.

278. During the year, Hong Kong continued to participate in the International Coffee Agreement. Under this Agreement, Hong Kong is obliged to subject all imports of coffee from non-member countries of the Agreement to quota control, which was set at 1.6 million lb. for the 'coffee year' 1st October 1969 to 30th September 1970.

279. Hong Kong also continued to participate in the International Wheat Agreement and undertook to import 90% of its wheat and wheat flour requirements from member countries. However, no licensing or quota control has been necessary as Hong Kong has traditionally imported about 90% from participating countries. To ensure Hong Kong's obligation is fulfilled in these international undertakings, a surveillance on the pattern of Hong Kong's imports is maintained.

280. The number of import licences issued for all purposes, in- cluding the control of strategic goods and reserved commodities, totalled 42,793 (38,413). To confirm the arrival in Hong Kong of strategic goods 200 (135) delivery verification certificates were issued.

281. The majority of export licences are issued for the purpose of exchange control. 582,170 (501,469) licences were issued (excluding textile licences processed in the Textiles Branch). 1,072 (1,065) delivery verifications or landing certificates issued by the proper authority in the country of import were produced by exporters as required following the export of strategic items.

Reserved Commodities

282. Certain essential food and fuel supplies are subject to licensing control. The department kept a close watch on commercial stocks of these commodities to ensure that they were adequate to cover possible supply shortages.

(a) Rice

283. The Rice Control Scheme continued to be administered under the Importation and Exportation (Reserved Commodities) Regulations. The basic quarterly import quota remained at 88,000 metric tons with 44,000 metric tons as the stipulated minimum reserve stock.

284. The international supply of rice continued to remain favour- able, with supply generally exceeding demand. Good harvests were recorded in most producing countries, and a number of importing countries were successful in their efforts to attain self-sufficiency. Export availabilities substantially increased as a result, and brought about a reduction in prices on the world rice market.

285. In the early part of 1969-70, allegedly due to heavier demand from Malaysia and Singapore arising from the tensions there, import prices of Thai whole rice edged upwards. The increase was however only temporary and adequate supplies arrested the price rise. Substantial quantities of U.S. rice were imported during August and September, following the U.S. Government's decision to resume export subsidies. In addition, Burma, which had not exported to Hong Kong for some time, was able to regain its position as a major supplier. These develop- ments prompted the Thai Government to announce a temporary reduc- tion of their export premium (equivalent to an export tax) in August, resulting in lower c.i.f. import prices for Thai rice. But this reduction was soon terminated and import quotations firmed up in September.

286. Keen competition again prompted the Thai Government to announce a reduction of the export premium at the beginning of December. Although this reduction, at HK$2 per picul for 100% whole white rice, was relatively small, Thai c.i.f. quotations for this grade

dropped by a wider margin and wholesale prices declined as a result. Wholesale prices of China rice followed the reduction in Thai prices and during the first quarter of 1970 decreased sharply by $13-15 a picul for various grades within a period of one week. In mid-March, the Thai Government announced a further reduction of 25% in their export premium. Import and wholesale prices of Thai rice then dropped further.

287. Between April 1969 and March 1970, c.i.f. prices for Thai rice 100% whole 3rd grade and 100% broken Al super decreased by $17.43 and $11.04 per picul or 24% and 23% respectively. Import prices for China rice also declined slightly. With the sharp decline in import prices, wholesale prices in Hong Kong also fell during the year. The benefit of these reductions was passed on to the public, at least in part, by improvements in the quality of the various grades of rice in the shops. Towards the end of the year retail prices of the improved grades showed a slight declining trend.

288. The level of per capita rice consumption, which had been declining for some years, appeared to reach a platform during the year but offtakes of good quality rice remained at a high level. In view of the favourable world supply situation, it was not considered necessary to keep a high stock. Rice stocks were kept at around 75,000 tons for the greater part of the year, sufficient for three months consumption.

289. Total rice imports during the year were 326,317 metric tons (302,320) as follows:

1969-70

Source

Thailand

...

China

U.S.A.

Cambodia

Mexico

Australia

Argentine

...

Philippines

N. Vietnam

Uruguay

Taiwan

Timor

...

Burma

N. Korea

Singapore

...

Total

...

M/Tons %

1968-69 M/Tons %

...

163,030 50.0

144,333 47.8

...

79,835

24.5

84,331 27.9

19,004

5.8

29,248

9.7

•

20,546

6.3

25,993

8.6

...

11,450

3.8

8,603 2.6

5,488

1.8

684

0.2

...

345

0.1

...

952

0.3

286

0.1

...

3,067

0.9

100

120

30,823

9.5

295

0.1

...

326,317

100.0

302,320 100.0

Offtakes from stocks were as follows:

Type

Whole Rice—

Thai Origin Chinese Origin Other Origin

1969-70

M/Tons

1968-69 M/Tons %

124,381

36.8

89,081 28.3

79,906 23.6

88,955 28.2

...

80,136

23.7

90,493 28.7

284,423

84.1

268,529 85.2

40,182

11.9

34,417

10.9

9,466

2.8

8,668

2.7

•

282

0.1

268

0.1

9,759

2.9

8,936

2.8

...

334,364

98.9

311,882

98.9

Broken Rice—

Thai Origin

Glutinous Rice-

Thai Origin Chinese Origin Other Origin

...

Sub-Total ...

Low Grade and Other Rice for

Industrial Use/Poultry Feeds-

Thai Origin

Cambodian Origin

...

1,745

0.5

1,293

0.4

160

0.1

239

0.1

Other Origin

...

1,853

0.5

1,870

0.6

3,758

1.1

3,402

1.1

Total Offtakes

...

338,122 100.0

315,284 100.0

(b) Frozen Meat

290. During the year, importers of frozen meat continued to be registered as stockholders with an undertaking to maintain a certain quantity as reserve stock.

291. Imports of frozen meat amounted to 32,255 (36,378) long tons in 1969-70. Of this amount 81% (87%) came from China.

292. Consumption of frozen meat and fresh meat during the past three years was as follows:

1967-68

Fresh Meat Frozen Meat

...

: :

1969-70

1968-69

L/Tons

L/Tons L/Tons

116,952

...

112,020

93,881

32,290

37,207

32,794

149,242

149,227

126,675

293. Imports of frozen poultry under licence amounted to 49.2 (38.2) million lb. The major source of supply was the U.S.A., followed closely by China. They supplied 34% (41%) and 33% (29%) of total imports respectively. Denmark, the third major supplier contributed another 16% (12%).

294. The increasing popularity of frozen poultry and the need to provide for a framework to facilitate the adoption of a more elaborate system of control if the need should arise, prompted the department to announce on 11th March 1970, the introduction of the registration of frozen poultry importers.

(d) Coal and Firewood

295. These two items have lost their significance as reserved com- modities and steps are being taken to delete them from the reserved commodities list. Imports of coal and firewood amounted to 38,323 (68,851) long tons and 666 (1,719) long tons respectively.

TRADE COMPLAINTS SECTION

General

296. The Trade Complaints Section, formerly of the Industrial Development Branch, was transferred to the General Duties Branch on 1st August 1969.

297. The Section undertakes to assist, wherever possible towards an amicable settlement of commercial disputes between Hong Kong business concerns and overseas customers. This service is voluntarily undertaken in a desire to help both parties and, in particular, overseas complainants who may have been unable to obtain a satisfactory response from the Hong Kong company concerned.

298. In handling trade complaints, however, the powers of the department are restricted as there is no legislation to enforce decisions in commercial disputes. The department's ability to assist as a mediator is therefore dependent to a large extent to the co-operation and good- will of the parties involved. Nevertheless, the department has been reasonably successful in bringing about settlement. In the event that the department is not able to effect an amicable settlement, it normally suggests to the complainant that he should seek legal advice.

299. During the year the number of trade complaints in which the department was asked to mediate continued to increase. 1,629 (1,323) complaints were received from overseas firms or individuals. About 75% of the complaints were amicably settled. In the same period, 45 local firms/individuals sought assistance in obtaining settlement of disputes with overseas firms. A detailed breakdown is given in Table 7.

Mail Order Association

300. The bulk of the complaints arose from the irresponsible actions of a few representatives of Hong Kong mail order tailoring firms soliciting orders overseas, largely in the U.S.A. These complaints had attracted a disproportionate amount of publicity which had damaging effects not only on the trade itself but also to a certain extent on Hong Kong's reputation. They had also created much concern in the U.S.A. and had led some authorities in the U.S.A. to consider means of im- posing stricter controls on the activities of representatives of Hong Kong mail order firms. As this trade has grown considerably and now con- stitutes a valuable business, it prompted the trade to organize itself to safeguard its interest.

301. On 18th March 1970, the Mail Order Association was formed. Its principal object is to promote and develop Hong Kong's mail order business. To do this, the Association considers it is essential to establish a channel of communication between the trade and various organizations both in Hong Kong and overseas and to settle complaints against its members by arbitration.

CHAPTER 8

DEPARTMENTAL ADMINISTRATION

GENERAL

302. The Administration Branch is headed by a Senior Executive Officer who is the Departmental Secretary. He is responsible for staff and establishment as well as general administration matters. There are two Executive Officers in the Branch.

ORGANIZATION AND PERSONNEL

Change in the Structure of the Trade Officer Grade

303. On 6th August 1969 Finance Committee approved the creation of four Principal Trade Officer posts on Segment D of Model Salary Scale 10. These new posts replaced four Senior Trade Officer posts. At the same time Finance Committee approved an extension of the Trade Officer salary scale to cover Segments B & C of Salary Scale 10 thereby raising the maximum salary from $4,388 p.m. to $4,783 p.m. One other change in the structure was also approved, namely, that the Assistant Trade Officer posts be transferred from Model Scale 10 to Model Scale 9. This latter change carried with it the proviso that Assistant Trade Officers serving on 6th August 1969 would retain their right on a personal basis to remain on Scale 10. It was also agreed that all Assistant Trade Officers would retain the right to act as Trade Officers on Scale 10.

304. The new salary scale for Assistant Trade Officers is $1,701 to $3,021 p.m. with provision for candidates holding good Honours degrees to enter at $2,031 p.m.

Establishment

305. At the beginning of the year the department's authorized establishment stood at 1,487 posts, of which 894 were in the Preventive Service. This included 9 new civilian and 10 new Preventive Service posts approved in 1969-70 Estimates. Vacancies in the civilian and Preventive Service establishments were 11 and 111 respectively.

During the year the civilian establishment was increased by 11 posts and the Preventive Service by 40 posts. On 31st March 1970 there were 36 vacancies in the civilian establishment of 607 posts and 82 vacancies in the Preventive Service establishment of 954 posts.

306. Senior staff changes during the year are described in paragraph 39 of Chapter 1.

307. The post of Commissioner, Export Credit Insurance Corpora- tion, was transferred to the establishment of the Colonial Secretariat in April 1969 while the staff of the London Office were similarly transferred in January 1970.

308. An organization chart of the department as at 31st March 1970 is shown at Table 8 with the divisional staff establishment given in brackets.

Recruitment

309. Seven separate recruitment exercises were undertaken to fill vacancies in the grades of Assistant Trade Officer, Industry Assistant Class II, Woman Revenue Sub-Inspector, Assistant Revenue Officer and Woman Assistant Revenue Officer. Response to advertisements of these vacancies was good. 183 newly appointed officers assumed duty during the period.

Promotions (excluding Preventive Service)

310. 29 officers were promoted during the period. These were:

From

Chief Preventive Officer

Senior Trade Officer

Assistant Trade Officer Industry Assistant Class I Industry Assistant Class II Personal Secretary Class I Personal Secretary Class II

Confidential Assistant Class II

G.C.S. I

G.C.S. II

G.C.S. III

Assistant Director Principal Trade Officer

Trade Officer

Senior Industry Assistant Industry Assistant Class I Senior Personal Secretary Personal Secretary Class I

Confidential Assistant Class I

Senior Clerk

G.C.S. I

G.C.S. II

Number

3 2

TRAINING

(see also paragraphs 246 to 250)

311. Mr. CHOW Yam-leung, Senior Industry Assistant, proceeded to the United Kingdom in November 1969 to attend two management courses and to be attached to the Commercial Section of the Govern- ment's London Office and H.M. Customs and Excise.

312. Mr. LEE Yip-tim, Revenue Inspector, attended the 2nd Course for Overseas Visitors on Customs given by H.M. Customs and Excise, London.

313. Mr. Dominic WONG Shing-wah, Assistant Trade Officer, was awarded a U.N. fellowship to attend the five-month G.A.T.T. In-Service Training Course on commercial policy in Geneva which commenced in February 1970.

314. Provision was made in the 1970-71 Estimates to enable two Assistant Trade Officers and two Revenue Sub-Inspectors to undertake training overseas.

315. The Industry Inspection Branch conducted one induction course between 21st July 1969 and 13th September 1969 which was attended by ten newly appointed Industry Assistants Class II. A further course for twenty-one new appointees commenced on 2nd March 1970.

WELFARE

316. Staff welfare is the responsibility of the Deputy Director, Administration and Industry, assisted by the Secretary. Welfare Fund

317. The Commerce and Industry Department (Civilian Staff) Welfare Fund and Sports and Social Club Fund were amalgamated and a combined fund entitled The Commerce and Industry Department (Civilian Staff) Welfare, Social and Sports Fund was established on 1st January 1970. It is administered by a Committee appointed by the Director under the Chairmanship of an Assistant Trade Officer.

318. The aims of the Fund are, to promote social and athletic interests of its staff members through the organization of social and sports functions, and to provide funds for any project which is beneficial to the officers on the civilian establishment. The Fund's first activities included a visit to a local brewery and a trip to the Tai Lam Chung Reservoir for staff and their families, and an inter-branch soccer league competition. In all these activities the response was gratifying.

Sports

319. A series of football games among departmental officers and with outside teams were played on Saturdays and Sundays during September 1969 March 1970. The necessary expenses were met by the depart- mental welfare fund.

Preventive Service Senior Officers Mess

320. The Preventive Service Senior Officers Mess was the venue of a number of successful social functions, and its dining facilities con- tinued to be well patronized by its members, particularly at lunch time. Presentations to officers going on retirement were also held in the Mess during the year.

Clerical Canteen

321. The Canteen which is used primarily by junior officers of the Preventive Service and clerical staff in Fire Brigade Building, continued to be well supported.

DEPARTMENTAL ACCOMMODATION

322. Planning work for renovating Fire Brigade Building continued during the year. The schedule of accommodation was approved by the Colonial Secretariat in August and the sketch layout plans prepared by the Public Works Department in conjunction with this department were accepted. At the end of the period the project was being costed, prior to the submission of an application for its upgrading to Category A of the Public Work Programme.

323. The move of the Economic Statistics Division of the Census and Statistics Department from the 4th floor of Fire Brigade Building resulted in a most welcome easing of space on other floors.

324. To facilitiate the lodging of trade declarations by members of the public and to improve working conditions of the staff concerned, the Ad Valorem Charges Collection Office was resited, but remained on the ground floor of Fire Brigade Building.

325. The Industry Inspection Branch moved from the Head Office Building of the Housing Authority at Ma Tau Kok to Tung Ying Building in Nathan Road in May 1969.

326. In view of the need for more office space for Lo Wu Revenue Station, an area of 200 sq. ft. in the new office complex at Lo Wu Railway Station was allocated to this department.

327. Projects of direct interest to this department that were under- going construction included the offices associated with Rumsey Street Multi-storey Car Park, Kai Tak Terminal Building and the Kowloon Camber building in Canton Road. Those in the planning stage com- prised an extension to the Fanling Excise Station, the new Preventive Service Training School, Colony Transit Mail and Sorting Office, and a secure inspection area at Kai Tak Airport for use by the Industry Inspection Branch.

CHAPTER 9

FINANCE AND STORES

REVENUE

328. Net revenue collected by the department amounted to $394.8 million, an increase of 11.8% over the previous year (Table 9). This represented 16.2% of all revenue collected by Government. Details of revenue for dutiable commodities are given in Tables 5 and 6.

329. It was estimated originally that some $12.3 million would be collected from ad valorem charges on import and export declarations. In fact the yield was more than $14.3 million, a reflection of the con- tinued growth in the value of Hong Kong's trade.

EXPENDITURE

330. The total departmental expenditure amounted to $19.6 million, an increase of 11.3% over the previous year. During the financial year, supplementary provisions totalling $364,540 over the estimate of $20,105,400 were approved.

331. The cost of operating the four overseas offices (in London, Washington, Geneva and Brussels) for the year was $1,066,100. This represented a saving of $21,250 on the approved estimate.

332. During the year, a total of 27 delegations participated in con- ferences, consultations, etc. on trade and related matters outside the Colony. The cost of these delegations was $242,300.

STORES

333. Preparations were made for the removal of the following stores to the Rumsey Street Multi-storey Car Park Building, which is expected to be ready for occupation in May 1970:

Uniform Store (Fire Brigade Building)

Dangerous Goods Store (Western Revenue Station) Confiscated Goods Store (U.S.D. Whitfield Depot).

The new accommodation will bring about the centralization of the above stores and since more space is to be provided, it will alleviate the congestion experienced during the year.

334. Confiscated liquor, tobacco and cigarettes continue to be 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 sold or issued free and their respective values were as follows:

Sold:

Liquor Cigarettes Cigars

...

Distributed free:

1969-70

1968-69

Value

Quantity

3,704 bots.

13,232

3,429 bots.

19,863

...

4,650 pcs.

222

2,030 pcs.

491

4,873 pcs.

1,932

Total

$13,723

Total

$22,017

1969-70

1968-69

Value

Quantity

Liquor Cigarettes

...

3,380 bots.

12,446

2,982 bots.

10,329

...

326,500 pcs.

7,836

648,000 pcs.

15,552

Cigars...

4,648 pcs.

707

4,381 pcs.

665

Tobacco

398 lbs.

1,990

484 lbs.

2,420

Total

...

$22,979

Total

...

. $28,966

335. Proceeds of cash sales are apportioned between the appropriate revenue sub-heads, viz. Duties and Revenue Reward Fund, while credits resulting from issue 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 ceiling is fixed at $200,000; sums in excess of this amount being transferred to general revenue. Total credits during the year resulting from cash sales as well as issues to other departments were:

Revenue Head 1 Duties: Subhead 2-Liquor... Revenue Head 1 Duties: Subhead 4-Tobacco Revenue Reward Fund

...

8,925

...

380 7,588

$16,893

336. In view of the large amount of revenue collected from the dutiable commodities, the Audit Department conducts a running audit of the department's accounts with particular regard to the calcula- tion of duty payable on dutiable commodities.

WELFARE FUNDS

337. The department operates two Welfare Funds, one for members of the Preventive Service and the other for the civilian staff. The latter is described in paragraph 317. 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 revenue of the fund consists of voluntary donations and a sum voted annually by the Legislative Council. Loans amounting to $5,560 were made during the year to help meet various costs, for example, medical treatment, maternity fees, education and funeral expenses for serving and retired officers and their dependants. In addition, expendi- ture of $3,203 was authorized for the general welfare of the Preventive Service. During the year one deposit at call of $8,000 was renewed and another of $6,000 made.

30th October 1970.

J. CATER,

Director of Commerce and Industry.

TABLE 1

EXPORTS OF COTTON TEXTILES RESTRAINED UNDER G.A.T.T. COTTON TEXTILES ARRANGEMENTS

FROM OCTOBER 1962 to SEPTEMBER 1970

Restrained Countries

Unit

1969-70

Restraint Limit

1968-69

Restraint Limit

U.S.A.

Sq. yd. 409,365,141

610,550

(All cotton textiles)

Canada

Doz.

Sq. yd.

(4 garment categories) 11,422,700 (All fabrics

including 1

|389,871,563

(All cotton textiles)

596,820

(5 garment categories) 11,090,000 (All fabrics including $ specific categories)

Exports

391,330,430

(All cotton textiles)

610,563 (5 garment categories) 4,861,574 (All fabrics including 5 specific

1967-68

5th Long Term Year 1966-67

Exports

Restraint Limit

Exports

Restraint Limit

|371,306,250

(All cotton textiles)

594,000 (5 garment categories) 11,090,000 (All fabrics including 5 specific categories)

4th Long Term Year 1965-66

3rd Long Term Year 1964-65

2nd Long Term Year 1963-64

1st Long Term Year 1962-63

Restraint Limit

Exports

Restraint Limit

Exports

Restraint Limit

Exports

Restraint Limit

Exports

379,598,270 343,625,000(6) 323,943,161 322,500,000(1) 349,010,637 274,712,288 273,255,307 251,112,600 243,386,600 231,144,890 227,157,291

484,595 600,000 517,954

(All cotton

textiles)

736,000 (5 garment categories) 11,090,000 (All fabrics including 5 specific categories)

601,714

7,849,083

(All cotton textiles)

736,000 (5 garment categories) 9,406,000 (11 fabric categories)

(37 categories)

(36 categories)

(30 categories)

634,022 712,000 599,243 614,000

(7 garment

(6 garment

categories)

(6 garment categories)

8,846,288

3,000,000 4,728,883 N.A.

5,863,113 N.A.

5,994,087

(6 fabric categories)

textiles)

616,426 (5 garment categories)

4,418,240 (All fabrics including 5 specific categories)

specific

category)

categories)

lb.

1,378,750

1,350,000

1,145,237

(All towels

(Towels)

in 5 specific

categories)

Australia

Sq. yd.

950,000(9)

(1 fabrics

category)

Federal

Republic of

Germany

Doz.

53,960,000(10) 67,650,000(4)| 68,240,165(4)| 66,650,000(4) 65,812,466 77,000,000

(Sq. yds.)

(sq. yds.)

(5 groups)

(7 groups)

(sq. yds.) (7 groups)

(sq, yds.) (7 groups)

(sq. yds.) (groups)

72,040,000 (sq. yds.) (7 groups)

400,000

399,884

380,000 339,167(3)|

350,000

309,139 N.A.

347,987

(Woven

nightwear)

Norway

Doz.

148,720

143,000

118,629

(4 categories of cotton garments)

(4 categories | (4 categories

Doz.

N.A.

of cotton

garments)

N.A.

of cotton

24,000 (Woven nightwear)

23,343

23,000

22,996

22,000

20,000

19,788

18,000

16,951

16,000

15,960

(Woven nightwear)

(Woven

nightwear)

garments) N.A.

N.A.

66,000

34,634

61,000

23,850

56,000

31,790

51,000

45,389

46,000

44,975

(Woven

sport &

work shirts) work shirts)

Benelux

Pc.

N.A.

Sq. yd.

N.A.

750,000(2) 547,071

1,251,517

(Woven shirts)

2,505(7) (metric tons) (All cotton

1,197,110(6)|

(5 categories)

(5 cate-

(Woven (Woven shirts) shirts) 1,058,870 N.A.

gories)

1,053,245 N.A. (Woven shirts) N.A.

1,539,648 N.A.

1,152,300 N.A.

1,015,320

N.A.

Sweden

Pc.

metric

ton

2,450(4)

(metric tons) (All cotton textiles

except yarns)

7,551,739(11) (3 groups of garments)

292(11) (Towels)

3,153(7) (metric tons) (All cotton textiles

except yarns)

5,370,000(8)

textiles except yarns)

4,490,208(8)

(5 groups of (5 groups of

garments)

8,236,386 5,549,749 (6 made-ups (6 made-ups and garment and garment categories) categories)

(1) A further 35,6 million sq, yds, was added to the first bilateral year limit on a once-and-for-all basis to take account of trade during 1965-66 in unsuspended, unrestrained categories which

were caught by the retroactive nature of the agreement. (2) From 1st January to 30th September 1967. All previous exports based on calendar year.

(3) Period for utilization of quota extended to 31st December 1965.

(4) From 1st January to 31st December.

(5) From 18th July to 30th September 1967.

(6) As a result of Hong Kong agreeing to the adoption of the dual criteria in defining cotton textiles, the aggregate limit was increased by 15 million square yards (an actual 5 million sq. yds.

was negotiated for the balance 1st June 30th September 1967 of the second bilateral year), with a growth of 5% in the third bilateral year, From 1st July 1968 to 31st December 1969.

(8) From 1st June 1968 to 31st May 1969.

(9) From 1st July 1969 to 30th June 1970. (10) From 1st January to 30th September 1970, (11) From 1st May 1969 to 30th June 1970. N.A. = not applicable.

TABLE 2

CERTIFICATION OF ORIGIN STATISTICS

1967-68

Year

1968-69

Value of Goods

Certified $Mn.

Certificates

No. Issued (Percentage Change

(Percentage

Compared with 66–67)

Change

No. Issued (Percentage Change

Value of Goods Certified $Mn. (Percentage Change

66–67)

67-68)

1969-70

Compared with Compared with 67-68) Compared with Compared with 68-69)

Value of Goods Certified $Mn. (Percentage Change Compared with

68-69)

No. Issued (Percentage Change Compared with 68-69)

Origin

Certificates:

Standard Certificates of

Commonwealth Preference

(a) Britain

135,806

1,393.69

151,903

2,058.50

175,169

...

事事

2,547.29

(-2.8)

(+3.0)

(+11.8)

(+29.1)

(+15.3)

(+23.7)

91,906

1,149.24

87,024

1,256.63

82,046

1,255.06

(+14.1)

(+20.1)

(-5.6)

(+9.3)

(-5.7)

(-0.1)

(b) Other Countries

22,182 309,192

151.05

22,632

331,239

175.67

22,502

345,278

159.38

(-18.0)

(+3.7)

(−3.6)

(+2.0)

(+7.1)

(+16.3)

(-0.6)

(+4.2)

(-9.3)

Comprehensive Certificates

of Origin:

(a) Commercial...

(b) Sample

*(c) Mail Order

*(d) Tourist

*(e) Gift Plan

Total...

47,275

54,192

53,593

(+16.9)

(+14.6)

(-1.1)

12,023

15,488

11,968

(+13.9)

(+28.8)

(-22.7)

24,998

23,192)

16,5231

(+9.6)

(-7.2)

(-28.8)

74,162

105,876

1,043.83

73,212

102,677

1,379.80

59,469

(-10.4)

(-6.3)

(+23.9)

(-1.3)

(-3.0)

(+32.2)

(-18.8)

79,794 (-22.3)

1,284.19 (-6.9)

6,716

6,273

3,802

(-8.7)

(-6.6)

(-39.4)

415,068

3,937.81

433,916

4,870.60

425,072

(+0.9)

(+12.4)

(+4.5)

(+23.7)

(-2.0)

5,245.92 (+7.7)

6,879

8,908

11,004

57.1

54.7

48.1

Domestic Exports

($ Mn.)

Percentage

Certified

Value of Stamp Fees Paid

(Including Miscellaneous

Certificates, not recorded

Above)

$4,761,780

$5,128,000

$5,150,850

* The issue of these types of C.C.O. were terminated w.e.f. 23rd January 1970 as a result of the relaxations of the U.S. Treasury Department

F.M.C. Regulations.

TABLE 3

MAJOR CONFISCATIONS UNDER OTHER LEGISLATION

Legislation

Quantity

Commodity

Unit

1968-69

1969-70

Importation and

Gold bars

...

lbs.

1,001.12

22.00

Exportation

and Regulations made thereunder

Indonesian silver coins

lbs.

2,214.18

Ordinance, Cap. 50

Philippine silver coins

lbs.

1,807.04

490.80

Australian silver coins

lbs.

2,214.78

Acetic anhydride

gal.

68.00

Gramophone records

nos.

484

Wrist watches

nos.

Transceivers...

sets.

Walkie talkies

sets.

Lighter flints

Cigarette lighters

tins.

nos.

•

12,000

564

Fountain pens

nos.

13,595

Chloramphenical powder

Vitamin B.12

Chinese herbs

lbs.

193.62

...

vials

459

Rice

cases lbs.

...

2,400.00

X-Ray parts...

nos.

Pharmacy and Poisons

Methyl Parathion

Ordinance, Cap. 138

Dexamphetamins tartrate .....

Choral betain

Quinalbarbitone

Merchandise Marks

Ordinance, Cap. 41

Butter

bottles

am-

poules

bottles

Amylobaritone

Forged trade mark labels... nos. Forged trade mark wrappers nos.

Chinese type spirit

tablets

...

6,759

117

lbs.

8.25

...

bottles

306

Floor polish...

lbs.

145

Blackcurrant syrup........

bottles

Watch dials...

nos.

385

Printing plates

nos.

Printing blocks

nos.

2221

2 3

126

TABLE 4

CONFISCATIONS UNDER THE DUTIABLE COMMODITIES ORDINANCE, CHAPTER 109 AND DANGEROUS DRUGS ORDINANCE, CHAPTER 134

Tobacco

Commodity

Quantity

Unit

1968-69

1969-70

Chinese prepared tobacco

...

lbs.

431.50

303.63

Foreign cigarettes

Macau and Chinese cigarettes...

Cigars

Tobacco stems

***

...

lbs.

958.58

518.00

...

lbs.

842.46

444.47

...

lbs.

98.56

122.50

...

lbs.

21.83

8.16

Tobacco leaf

lbs.

22.05

...

lbs.

12.72

39.34

Pipe tobacco

Liquor

European type liquor Chinese type liquor

Beer

Chinese medicinal wine

Alcohol

Mash Stills

...

Hydrocarbon Oils

Treated diesel oil

Dangerous Drugs

Opium, raw Opium, prepared

Opium, dross

...

Opium, water

Opium, residue

...

:..

Morphine hydrochloride

Barbitone

Canabis, marijuana

Canabis, resin

Opium pipes

...

Opium pipe heads

Opium lamps

...

gals.

391.83

366.42

gals.

3,750.48

1,729.99

...

gals.

198.31

216.83

gals.

132.72

106.98

gals.

78.00

174.00

gals.

176,077.00

106,171.50

nos.

184

104

gals.

47,229.00

65,075,25

lbs.

363.03

172.52

...

lbs.

3.33

0.86

lbs.

8.29

0.16

fl. ozs.

126.30

lbs.

4.62

lbs.

47.58

110.30

lbs.

551.17

...

lbs.

2.30

0.52

...

lbs.

21.96

...

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 and Cigars

European Smoking Tobacco (including

Snuff)

Chinese Prepared Tobacco

Tobacco Leaf

Total

TABLE

DUTY FROM DUTIABLE

1967-1968

COMMODITIES (GROSS)

1968-69

1969-70

Unit

Quantity

% Change

Duty

% Change

Quantity

% Change

Duty

% Change

Quantity

% Change

Duty

% Change

Gallons

147,279

308,111

48,989

156,597

8,783,792

22,181

++++

5.0

9,649,178

1.9

22,610,288

1.4

3,299,101

8.0

3,198,770

5.8

16,693,451

+ 4.9

1,572,671

+1+11+

4.8

166,385

+ 13.0

0.5

398,476

+ 29.3

1.6

53,310

+ 8,8

10.0

171,369

9.4

10,903,094 28,841,407 3,618,097 3,415,703

+ 13.0

+ 27.6

201,295 462,935

+ 21.0 + 16.2

13,170,502

33,568,991

+ 20.8 + 16.4

+ 9.7

58,533

+ 9,8

3,941,437

+ 8.9

+ 6.8

194,265

+ 13.4

7.8

3,880,274

+ 13.6

9,231,289

5.1

5.9

24,015

+ 8.3

17,820,774 1,686,931

6.8 7.3

10,813,984

+ 17,1

20,793,053

+ 16.7

27,127

+ 13.0

1,860,234

1,802,974 1,600,939

132,914 3,011

13,006,787

↓ │

5.9

12,495,612

6.1

0.8

14,574,652

4.0

1,948,646 1,689,861

8.1 5.6

13,501,726 15,439,941

+ 8.1 + 5.9

1,648,799 2,089,411

15.4

5.6

1,761,227

7.5

15.2

48,826

11.2

152,514 4,340

+ 14.7 + 44.1

2,058,355 81,005

+ 16.9

+ 65.9

5.0

85,903,776

3,2

ป

13,840,205

+ 6.4

97,367,033

+ 13.3

170,382 4,840

15,671,571

+ 23.6

+ 11.7 + 11.5

+ 13.2

11,432,578 18,683,553

- 10.3

15.3

+ 21,0

2,276,745 108,100

+ 10.6

+ 33.4

109,715,467

+ 12.7

Pounds

5,503,560

0.1

58,808,545

0.1

6,031,780

+ 9.6

64,532,097

+ 9.7

6,321,119

+ 4.8

67,521,178

+ 4.6

70,222 423,631 12,888,979

6.0

+ 2.1

597,575 1,059,075

+ 12.3

101,709,752

+++

6.3

59,954

2.1

396,175

14.6 6.5

513,732

990,438

14.0 6.5

12.6

†11,351,001

11.9

89,945,258

11.6

68,421 367,480 11,774,328

+ 14.1

586,318

7.2 + 3.7

918,698 93,761,213

18,886,392

+ 8.1

162,174,947

7.6

17,838,910

5.5

155,981,525

3.8

18,531,348

+ 3.9

162,787,407

+1+

+ 14.1

7.2

4.2

4.4

Hydrocarbon Oils:

Liquefied Petroleum Gas...

Light Oils

Diesel Oils

Furnace Oils

Pounds *20,233,018

Imp. Gal. 30,816,555

315,116,477

Other Type...

Total

Table Waters...

Locally Manufactured Liquor

Intoxicating Liquor

Spirituous Liquor other than Intoxicating

Liquor

Table Waters...

Tobacco

Hydrocarbon Oils

Total

65,504,671

49,938,265

1+1+

13.9 2,0

404,660 40,991,008

+ 3.5

30,294,172 31,511,648

3.8

20,233,018 lb.

4,924,005

108,125,493

37,116,754

1+++

7.8

32,049,093

0.5

75,867,050

3.5

354,428,113

3,8

54,529,728

+ 83.4 + 4.0 +15.8 +12.5 + 9.2

4.2

461,375,968 gal. + 2.5

37,116,754 lb. 516,873,984 gal,

+ 83.4 + 12.0

742,335 42,500,747 33,293,133 35,442,811 5,362,714

117,341,740

+ 83.4

+ 3.7

+ 9.9

+12.5 402,829,460

+ 8.9

48,090,011 35,730,994 85,366,461

56,707,013

+ 29.6 + 11.5

961,800

+ 29.6

47,405,513

+ 11.5

+ 12,5

41,546,953

+ 24.8

+ 13.7

40,282,946

+ 13.7

4.0

5,559,835

+ 3.7

+ 8.5

48,090,011 lb. 580,633,928 gal.

+ 29.6 + 12.3

135,757,047

+15.7

Gallons

16,744,160

+ 10.1

8,046,798

+ 10.2

17,110,322

+ 2.2

8,212,955 + 2.1

Refund and Drawback

20,759,959

+ 21.3

9,964,781

+ 21.3

40,671,741

123,780 2,692,306

0.3 18.3

67,602 9,913

+ 89.7

+8372,6

+ 25.0

4,657

26.0

43,569,999

21.0

97,843 5,789,786

21.0 +115.0

41,551 22,856

38.5

+130.6

37,196,574

8.5

57,622 5,084

37,312,640

+ 0.3

101,890 6,398,779

+ 4.1

+ 10.5

+ 38.7

77.8

4,447

43,153,057

4.5

3,586

―

19.4

1.0

* Liquefied petroleum gas became dutiable with effect from 28.6.67.

43,879,601

† Duty rate on tobacco of Commonwealth Origin revised with effect from 5.30 p.m. on 26.6.68.

+1.7

TABLE 6

REVENUE FROM DUTIABLE COMMODITIES LICENCES, 1969-70

No. of Licenses Issued

Revenue

Importer's:

Liquor

Tobacco

356

178,000.00

...

39,500.00

...

Hydrocarbon Oils

Table Waters Methyl Alcohol

193

97,000.00

...

16,500.00

...

730.00

...

Exporter's:

Liquor

Tobacco

205

5,480.00

...

2,140.00

...

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

...

•

...

470.00

...

1,620.00

...

80.00

...

634

...

2,787

951,000.00 1,674,690.00

473

47,300.00

...

180

90,000.00

...

459

45,900.00

...

600.00

...

50.00

...

***

...

443

66,150.00

1,905

176,100.00

...

Beer

...

5,343

317,360.00

Tobacco

11,657

707,540.00

•

...

Hydrocarbon Oils Methyl Alcohol Medicated Liquor

Manufacturer's

Distillers Brewer

1,268

...

31,700.00 410.00

450.00

...

Liquor

...

Still

Liquor Manufacturer

Tobacco

Table Waters

Warehouses:

General Bonded

Liquor

Tobacco

...

Hydrocarbon Oils

Table Waters

Methyl Alcohol

...

Ship and Harbour Vessel Licences

...

Licence fees for persons importing for own

use and miscellaneous

Net Total

...

2227

19,000.00

...

5,000.00 10,300.00

90.00

***

28,000.00

...

10,000.00

18,000.00

750.00

...

90.00

340

3,400.00

38,365.93

26,831

$4,583,765,93

TABLE 7

TRADE COMPLAINTS FROM OVERSEAS COMPANIES OR INDIVIDUALS HANDLED BY THE DEPARTMENT

FROM 1.4.69 TO 31.3.70

Type

Breach of Contract

American Continent

Source

...

Rest of the World

Total

U.S.A.

Rest of the continent

125

795

179

998

•

...

Inferior Quality

Non-delivery

Outstanding Debt

Short-shipment

Miscellaneous

Total

129

...

220

310

...

1,105

466

1,629

TABLE 8

COMMERCE AND INDUSTRY DEPARTMENT, HONG KONG

DIRECTOR

Deputy Director,

Administration & Industry

Assistant Director, Industry

Industry Division

Assistant Director, Preventive Service & Dutiable Commodities

Assistant Director, Commercial Relations (Europe)

Deputy Director, Commercial Relations

Assistant Director, Commercial Relations (Other Regions)

Overseas Offices

Preventive Service

'E' Division

'R' Division

London

Brussels

Washington

Administration & Accounts Branches

Senior Executive Officer Treasury Accountant

Accounts and Stores. Personnel.

Internal Administrative

Matters.

General Duties Branch

Industrial Development

Certification Branch

Industry Inspection Branch

Dutiable Commodities

Administrative Officer

Legislation. Departmental Reports, Departmental Publicity

and Public Relations. Import and Export

Licensing. Exchange Controls

(Licensing Procedure). Strategic Commodities, Reserved Commodities. Trade Complaints.

Branch

Principal Trade Officer

Industrial Land. Industrial Promotion. Industrial Infrastructure. Health and Safety

Standards of Hong Kong Products, Liaison with Industrial

Organizations, General Assistance to

Industry.

Principal

Trade Officer

Certification of Origin (including Standard Certificates, Comprehensive Certificates for the American Market and Commonwealth Preference Documentation).

Senior Industry Officer

Inspection of Factories and Consignments under Certification and Export (Textiles) Licensing

Requirements, including

Investigations and Prosecutions.

Dutiable Commodities

Control-Tobacco, Hydrocarbon Oils, Table Waters, Methyl Alcohol, Alcoholic Liquors.

Chief

Preventive Officer

Protection of Revenue. Excise Duties. Anti-Smuggling Operations. Essential Supplies

(Food).

Principal Trade Officer

Commercial Policy

(Europe). Liaison with Trade

Development Council and Export Credit Insurance

Corporation. Textiles Advisory Board,

Principal Trade Officer

Commercial Policy (Other Regions). Liaison with Trade

Development Council and Export Credit Insurance

Corporation. Trade and Industry

Advisory Board.

Establishment

(excluding

(105)

supernumerary posts)

31st March 1970.

(31)

(19)

(101)

(111)

(1) Uniformed (36) Civilian

(882) Uniformed

(40) Civilian

Total Permanent Establishment: 531 civilian officers plus 883 in the uniformed Preventive Service.

Total Cost

About $21 million (estimate for 1970-71).

Total Revenue Collected

About $413 million (estimate for 1970-71).

(46)

Geneva

(35)

(7)

TABLE 9

NET REVENUE COLLECTED FROM ALL SOURCES

Actual Revenue

Approved Estimates

Increase/ Decrease

1969-70

1968-69

Duties

Hydrocarbon oils imported

124,000,000

135,753,460

117,337,293

+15.7

Intoxicating liquor imported...

71,000,000

81,522,312

69,379,458

+ 17.5

Liquor other than intoxicating

Liquor imported

2,200,000

2,327,222

2,097,809

+ 10.9

Tobacco imported

120,000,000

125,474,767 | 118,784,951

+ 5.6

Liquor locally manufactured...

19,500,000

19,307,642

19,960,586

+ 3.3

Table waters

Licences

Hydrocarbon oils

Liquor

Tobacco

...

Miscellaneous (table waters).

Fines and forfeitures

8,800,000

9,959,697

8,190,099

+ 21.6

...

198,000

198,007

194,871 + 1.6

3,340,000

3,488,846

3,323,914

+ 5.0

880,000

861,525

883,955

2.5

33,500

35,387

32,837 + 7.8

Fines

...

Forfeitures

Penalties

...

200,000

15,180

94,864

84.0

10,000

3,415

4,430

2.3

supervision

years

•

Fees of Court or Office

Denaturing

Import and export declarations

Official certificates

Official signatures

Departmental services and

Overpayments in previous

Bonded warehouse supervision Loss of, or damage to

Government property

Advertisement revenue Publications

Surplus and condemned stores

460,000

383,594

405,304

5.4

12,300,000

14,362,893

11,936,989

+ 20.3

4,600

8,520

3,960

+115.2

...

3,600

1,285

3,425

62.5

100

177

174

+ 1.7

100

6,009

4,807

+ 25.0

Anti-narcotic smuggling guards

1,403

310,000

359,565

326,643

+ 10.1

100

234

26,800

30,478

324 1,950 30,259

27.7

+ 0.7

699

Miscellaneous

...

80,100

692,209

32,451 97,153

―

97.8

+612.5

363,346,900 394,793,123 | 353,129,909

+ 11.8

፣

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8.2

112 7

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