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tensions and crises arisen from similar situations in other regions, or even promote peace in the world. Although such is not the aim of the agreement, it is nevertheless significant.
In fact, the people of Hong Kong are pleasantly surprised that the agreement is better than what we have expected. It contains all that we desire and what we have asked for, including maintenance of the present style of living, the rule of law, and freedom. We should therefore have reason to be pleased and excited in accepting the detailed agreement which not only takes care of the interests of the people of Hong Kong as a whole, but also underlines the following: (1) Benefits to Hong Kong
(a) Hong Kong is no doubt Chinese territory and it is best to solve the question peacefully.
(b) There are close economic links between Hong Kong and China which is our first and foremost trading partner. China exports abundant foodstuffs to Hong Kong and is at present the largest exporting country to Hong Kong. Her abundant supply and reasonable prices of goods help much to develop trade in Hong Kong. Goods from China also account for one-third of Hong Kong's re-export—the largest share compared with other countries. As for exports, China has become the third major market for Hong Kong goods, just after Japan and the U.S.A. The amount of trade between China and Hong Kong during the first six months of this year reaches 50 billion dollars, representing an increase of 20 billion dollars as compared with the same period last year. We have every reason to believe that after the settlement of Hong Kong's future, trade between the two members of the family which are inter-dependent will be much expanded and commercial relations fostered.
(c) Many world experts predict that the economic centre of the world in the late 20th and early 21st century will shift to the Asian Pacific Region and Hong Kong is geographically located at the centre of the region. Hong Kong has already established good economic links with the other Asian Pacific countries. If the question of its future is settled, the political climate here will be clear and stable, and Hong Kong will surely be more prosperous since it is the financial, trade, transport, and tourist centre in the Asian Pacific Region.
(d) Putting aside the political factors, whether Hong Kong will continue to enjoy prosperity in the future depends on her economic development, taking advantage of her favourable economic conditions. It is undeniable that Hong Kong has its advantages and disadvantages too. It is well known that Hong Kong is a free port and an international trade and financial centre. In addition, it also has the edge on the neighbouring countries in such fields as capital, talents, technical skills, commercial services, management, markets, communications,
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and transports etc. Its weaknesses are the total lack of natural resources, limited land supply, insufficient labour, small local market, and dependence on the import of raw materials. However, the economic factors in China are just opposite to those in Hong Kong. What we lack, China has plenty and vice versa. If the two complement each other and co-operate in mutual development, the future can be immeasurable.
(e) Hong Kong is the ideal place for western countries to keep in contact with China. When it is blessed with political stability, the western countries will surely conduct their trade with China through Hong Kong.
(2) Benefits to China
(a) It is the first step to realize the aim of peaceful union of the whole of China, enhancing the confidence and respect for the present leadership by the one billion Chinese population.
(b) It offers great help to the modernization of China. After the destructions caused by the Cultural Revolution, China is in lack of capital, technical skills and knowledge, and managerial experiences. She has now adopted an open policy and should brace herself to catch up. So if China makes use of Hong Kong as a bridge to establish contact with the rest of the world, she will be able to attract large investments directly or indirectly, obtain advanced technology and management methods from developed countries through Hong Kong. It will also be easier for her to employ foreign experts, train the people, and make use of foreign capital. If China adopts socialism to remould Hong Kong after her exercise of sovereignty, Hong Kong will inevitably be on the decline and become unstable. Such a state of affairs is totally against pragmatism. It is therefore a wise policy and decision to retain the capitalist system in Hong Kong so that it will play an important role in the four modernizations of China.
(c) As mentioned earlier, the Asian Pacific Region may in the foreseeable future develop into a world economic centre. With its geographical advantages, Hong Kong will become increasingly important as a financial, trade, and transport centre, and will help China open international markets, develop foreign trade, and obtain advanced technology, thus contributing greatly to the four modernizations of China.
(d) The inter-dependence between China and Hong Kong in trade and economic affairs will further encourage them to remain mutually beneficial to each other.
(3) Benefits to Britain
Britain naturally has sentiments towards Hong Kong due to their relations in the past hundred and more years. Her enlightened rule over the territory