imports, the market for 32.2% of its domestic exports, and 20.8%
of its reexports in 1989; in 1990, 612,000 American tourists
visited Hong Kong, 22,000 Americans live in the Territory on a
long-term basis--the largest expatriate business group there:
and, Hong Kong is a major source of investaent into the United
States, particularly the West Coast. In short, the people of
Hong Kong and the United States are of critical economic
importance to one another. More broadly, Hong Kong not only
shares our comitment to free trade and market-oriented economic
principles, it also is an ally in multilateral economic and trade
organizations such as GATT.
The facts recounted above are well-known and need no further
elaboration here. Hong Kong's importance along another
dimension, however, has received insufficient attention--its role
in the emerging economy of "Greater China" (the PRC, Hong Kong,
and Taiwan). One of the most important developments in the world
economy today is the emergence of the increasingly interdependent
economy of "Greater China." Were this economy considered a
single entity, it would have been America's third largest trading
partner in 1989 (after Canada and Japan, and larger than fourth-
ranking Mexico). Taiwan, Hong Kong, and the PRC are now major
trade and investment partners of one another. Three-way trade
hit $68.04 billion in the first ten months of 1991, while three-
way [cumulative] investment reached $36.4 billion, according to
the Hong Kong Trade Development Council. Hong Kong accounts for
about two-thirds of the direct foreign investment in the PRC; the