recognition of Taiwan as a separate political entity by

other countries; upgrading Taiwan's defence forces (US

defence sales: the Netherlands has only recently been

allowed to reinstate Ambassadorial relations, after the

sale of submarines to Taiwan); support for the Taiwan

independence movement.

CHANGES IN CHINA: GENERAL POINTS

7.

What relevance do the current economic, political and

social changes in China have to "one country, two

systems and the future of Hong Kong"? Since China is to

remain socialist and Hong Kong to remain capitalist,

should changes in either system affect the other, before

or after 1997? And remember that Hong Kong's future in

many contexts must be Hong Kong from April 1985 not just

the Hong Kong SAR from July 1997.

8.

Hong Kong has always been affected in some measure

by major changes in China and in China's relations with

the outside world (1911 Revolution, 1949 Revolution,

Korean War, Vietnam War, Cultural Revolution). But HK

has been considerably insulated by operating different

systems. The salient differences have varied over time.

Elements have been: common law legal system, colonial

status, free port, no exchange control regulations,

/English

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