-
"Industrial investment primarily involving outward processing arrangements still predominates, although in recent years Hong Kong companies have increasingly extended the scope of their investment to other sectors such as hotels, restaurants, retail trade, real estate, and infrastructural facilities including notably highways, ports, electricity generation plants and telecommunications."
+
He added that a recent estimate by Chinese officials put the total number of Chinese workers engaged by Hong Kong companies in Guangdong Province at over four million.
Mr Tsang said by entering into extensive outward processing arrangements across the border, Hong Kong had contributed substantially to China's and, in particular, Guangdong's industrialisation process.
"Our other investments in China have also helped the economic restructuring and development in the locations concerned.
"On the other hand, the industrial production capacity of Hong Kong is effectively multiplied manifold, as the four million Chinese workers are a de facto expansion of our own manufacturing workforce," he said.
In the opposite direction, he said, China had likewise raised substantially its stake in Hong Kong, which was evidenced by a doubling of its total direct investment in the territory form an estimate of US$10 billion by end-1990 to some US$20 billion by end-1994.
Mr Tsang said Hong Kong and China were also close partners on the financial front and cross-border financial flows had shown a marked increase over the years.
"As an indication, the external liabilities to China of our authorised institutions grew markedly, by an average of 47 per cent per annum between 1980 and 1994.
"The external claims of our authorised institutions on China recorded a less rapid, but still substantial increase of 28 per cent per annum," he said.
Besides tapping funds from Hong Kong's banking sector, Mr Tsang said, China was also utilising the territory's securities market.
"At present, 17 state-owned enterprises in China have listed their H shares on our Stock Exchange, raising total capital of over $20 billion," he said.
Mr Tsang said the Chinese and Hong Kong economies had become interwoven.