XN000022-1986-07-17 — Page 2

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THURSDAY, JULY 17, 1986

SIR EDWARD EXPLAINS U.S. BUSINESS INVOLVEMENT

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THE REASON WHY THERE ARE MORE AMERICANS THAN BRITONS LIVING IN HONG KONG STEMS FROM U.S. BUSINESSMEN'S APPRECIATION OF INVESTMENT OPPORTUNITY IN HONG KONG AND ITS POSITION AS A GATEWAY TO CHINA, THE GOVERNOR, SIR EDWARD YOUDE, SAID IN SEATTLE TODAY (THURSDAY, HK TIME).

ANSWERING QUESTIONS FOLLOWING HIS ADDRESS TO A LUNCH HOSTED BY THE STATE OF WASHINGTON COUNCIL ON INTERNATIONAL TRADE AND THE WASHINGTON STATE CHINA RELATIONS COUNCIL, SIR EDWARD ALSO NOTED THE ENORMOUS MARKET THE UNITED STATES HAD TO OFFER AND THE EXCELLENT COMMUNICATIONS IN HONG KONG, AS WELL AS ITS STABLE ECONOMY AND LOW TAX RATES.

WHILE BRITAIN HAD IN RECENT YEARS BEEN DEVELOPING CLOSER TIES WITH EUROPE, THERE WAS STILL +QUITE A RESPECTABLE BRITISH BUSINESS COMMUNITY+, PARTICULARLY IN THE FINANCIAL SERVICES SECTORS AND IN LONG ESTABLISHED TRADING COMPANIES.

ASKED WHETHER HE THOUGHT OVERSEAS INVESTORS HAD CONFIDENCE IN HONG KONG AFTER 1997, SIR EDWARD CITED THE RECENT DEAL TO BUILD A SECOND CROSS HARBOUR TUNNEL +TOTALLY FINANCED BY THE PRIVATE SECTOR, WITHOUT A PENNY OF GOVERNMENT MONEY GOING INTO IT.+

HE SAID THAT WAS PROOF ENOUGH THAT SOME INVESTORS BELIEVE THERE IS MONEY TO BE MADE IN LONG-TERM INVESTMENT IN HONG KONG.

SIR EDWARD WAS ALSO ASKED TO COMMENT ON THE MOVE TOWARDS MORE REPRESENTATIVE GOVERNMENT IN HONG KONG AND THE POSSIBLE DEVELOPMENT OF POLITICAL PARTIES. HAVING EXPLAINED THE BACKGROUND TO THE TERRITORY'S ADMINISTRATIVE PROCESSES HE SAID IT WAS IMPORTANT THAT ANY CHANGES BE GRADUAL AND WELL CONSIDERED.

+HONG KONG HAS NEVER BEEN DIVIDED BY POLITICAL PARTIES,+ HE SAID, NOTING THAT ITS SUCCESS STEMMED FROM THE APPRECIATION OF ITS SPECIAL CIRCUMSTANCES WHICH MEANT DISCUSSION ON WHAT SHOULD BE DONE WHICH BROUGHT CONSENSUS.

SINCE HONG KONG WAS COMPLETELY RELIANT ON THE SUCCESS OF ITS ECONOMY, THE GREAT OBJECTIVES MUST ALWAYS BE TO MAINTAIN THE STABILITY WHICH UNDERLIES THE PROSPERITY, SIR EDWARD SAID.

HE SAID THERE WAS MUCH DEBATE ON HOW FAR AND HOW QUICKLY THE MOVE TOWARDS MORE REPRESENTATIVE GOVERNMENT SHOULD GO, AND DECISIONS ON THE NEXT MOVE WOULD BE CONSIDERED NEXT YEAR.

BUT HE NOTED THAT FOR MANY PEOPLE IN HONG KONG, MATTERS RELATING TO THE ECONOMY WERE OF HIGHER PRIORITY THAN POLITICS.

/ASKED WHY