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26.
Another approach which illustrates the
importance of Hong Kong as a source of foreign
exchange is to compare China's net foreign exchange earnings from Hong Kong with its foreign exchange and
gold reserves (Table 11).
Tble 11: China's foreign exchange and gold reserves
Foreign exchange
reserves
(US$Mn)
Gold
reserves
US$ value of gold reserves (*)
(million
(US$ Mn)
troy ounces)
Foreign exchange and gold reserves
(US$Mn equivalent)
Net foreign
exchange earnings from Hong Kong (US$ Mn)
1 79 1980
2154
(12.80)
6707
8861
3829
2262
(12.80)
7526
9788
4764
1981
4773
(12.67)
5068
9841
5077
82
11125
(12.67)
5752
16877
5320
te: (*) Value at London year-end closing gold price.
Without the foreign exchange earnings obtained from Hong Kong, China's foreign exchange and gold reserves would have been depleted within about two to three years. In practice, what this would probably have meant is that China would have had to pursue a less expansionary economic policy, or at least one less dependent on imported technology.
G.F. 326
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