61.   Yet this tightening did not generate great pressure on labour costs, as productivity continued to rise in the economy.

62.   For Kohl, the minister in his office, Friedrich Bohl, said the priority was to cut labour costs and overcome disencentives to the employment of more labour.

63.   German companies complain that high labour costs and the strength of the mark are strangling their competivitity.

64.   He called for greater flexibility in the work place and lower unskilled labour costs, saying individual member states could mainly help in this.

65.   He said the shift, mainly to other Asian countries with lower labour costs, reflected not only the higher yen but also a global trend.

66.   He said inflation in Hong Kong was higher than in many other places, making labour costs higher than elsewhere.

67.   He said the government had to remain firm in pursuing its policies aimed at lowering labour costs, restructuring working hours and developing the service sector.

68.   However increasing labour costs, added to the strong mark exchange rate, could act as a brake.

69.   However, when the room for financial manoeuvre has already been exhausted, the burden of adaptation falls practically entirely upon labour costs, he said.

70.   In Britain, productivity was the lowest of any European country, despite low labour costs, and quality was the second lowest.