The label 'Made in Hong Kong' is one which appears on many of the toys which give so much pleasure to children throughout the world. Hong Kong is the world's largest toy exporter and has been for many years. It produces a wide range of toys, especially plastic products such as dolls, doll houses, toy figures, educational building blocks, toy weapons and miniature furniture. Electronic toys and games follow closely, then metal toys. Popular new areas of development include sporting goods, games and accessories and toys for infants. The Hong Kong toy industry employs 3,627 people at 428 different production sites, most of which are small establishments. However, the nature of its business is changing, partly to meet the challenge from chief competitors Taiwan, Japan and South Korea. Manufacturers are increasingly investing in the mainland where labour costs are significantly lower. They are also setting up manufacturing plants in Thailand, Malaysia, Indonesia and the Philippines. Hong Kong's role is also shifting more towards quality control, management, marketing, product design, trial production and production planning. While the local industry is famous for designing and producing high-quality toys and games, about 70 per cent of sales come from contract manufacturing for companies such as Fisher-Price and Hasbro from the US and Tomy from Japan. Product specifications and designs are usually provided by the buyers, which cuts down local manufacturers' risk in product design. The average number of people employed in the industry has fallen over the years as a result of rising labour costs, increased mechanisation of production and the shift to the mainland and offshore. However, productivity continues to rise, growing by an average of 18 per cent a year compared with 13.7 per cent across the manufacturing sector. The manufacturing of some high-end, sophisticated items is also expected to become a growth area for the Hong Kong toy industry. Computer-aided design and manufacturing systems are becoming increasingly common. However, the chairman of the Toy Advisory Committee of the Trade Development Council, Edmund Young, said there were some uncertainties in the market following the recent economic crisis in the region. 'The economic turmoil in Southeast Asian countries and a drastic depreciation in their currencies have made Hong Kong products relatively expensive for some consumers there,' Mr Young said. But he said the fair would be a 'good market indicator' for traders.