Hong Kong Aircraft Engineering Co (Haeco), which maintains and overhauls commercial aircraft engines, says competitive pressures facing the company's businesses are unlikely to ease in the short term. Chairman David Turnbull told yesterday's annual meeting: 'The market is slightly stronger than it was two or three years ago. It has improved, but it is still nothing to get excited about.' He said the improvement in world-wide rates for heavy airframe maintenance seen over the past few months should be regarded with caution. He warned that although there had been some moderation in Hong Kong's rate of inflation it was still comparatively high which was a cause for concern, particularly as Haeco had to compete globally. 'Aircraft maintenance is one of the few industries in Hong Kong that really competes in the world market,' he said. Haeco has struggled over the past few years as airlines have faced rising costs and deteriorating yields. After posting falling net profits for 1994 and 1995, Haeco was removed from the Hang Seng Index in August. The company's operating profit rose a moderate 5.3 per cent in 1996. Mr Turnbull said there had not yet been a final decision on the company's proposal to build a second aircraft maintenance hangar in the Chinese port city of Xiamen.