4. Deindustrialisation

Rising labour and production costs, as well as the gradual loss of price competitiveness in the late 1980s, caused the decline of Hong Kong’s industry at large. In addition, on the external level, China’s open door policy in 1978 followed by a series of economic reforms further weakened manufacturing in the city. Many factories were relocated to the mainland, particularly to other cities in the booming Pearl River Delta region.