XN000022-1994-04-22 — Page 3

FRIDAY, APRIL 22, 1994

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WITHDRAWAL OF CHINA'S MFN STATUS AFFECTS CONFIDENCE IN HK

(FRIDAY)

THE GOVERNOR, THE RT HON CHRISTOPHER PATTEN, TODAY SAID HONG KONG NEEDED UNCONDITIONAL RENEWAL OF CHINA'S MOST FAVOURED NATION (MFN) STATUS, OR ITS CONFIDENCE WOULD BE SERIOUSLY AFFECTED A CRUCIAL TIME.

AT

SPEAKING AT A LUNCHRON HOSTED BY THE AMERICAN CHAMBER OF COMMERCE, MR PATTEN NOTED HONG KONG WOULD BE HARDER HIT BY THE DAMAGE MFN WITHDRAWAL WOULD DO TO CHINA.

"NO DOUBT WE WOULD BOUNCE BACK IN TIME; BUT THE SHORT-TERM IMPACT WOULD BE EXTREMELY SERIOUS.

"OUR LATEST ESTIMATES ARE THAT OUR ECONOMIC GROWTH WOULD BE CUT BY MORE THAN HALF; AND OUR UNEMPLOYMENT WOULD MORE THAN DOUBLE, THE GOVERNOR SAID.

HE SAID SUCH A BLOW WOULD COME AT A WORST POSSIBLE TIME FOR HONG KONG WHICH WAS IN THE FINAL THREE YEARS OF THE TRANSITION FROM BRITISH TO CHINESE SOVEREIGNTY.

"THE FACT THAT IT HAS GENERALLY GONE PRETTY WELL SO FAR HAS BEEN IN LARGE PART DUE TO HONG KONG'S ROBUST BCONOMIC PERFORMANCE, WHICH IN TURN HAS BEEN DUE IN LARGE PART TO THE GROWTH OF CHINA TRADE.

"A BODY BLOW TO THAT TRADE WOULD BE A BODY BLOW TO CONFIDENCE IN HONG KONG AT A CRUCIAL TIME. IT WOULD PUT AT RISK ALL THAT WE TRYING TO DO TO SECURE HONG KONG'S FUTURE.

ARE

THE GOVERNOR SAID THE MPN RENEWAL. WAS IN THE INTERESTS NOT ONLY OF HONG KONG BUT OF THE U. S OF ASIA AND THE REST OF THE WORLD.

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HE NOTED THAT 900 U.S. FIRMS WERE ESTABLISHED IN THE TERRITORY AND U.S. INVESTMENT IN HONG KONG WAS OVER US$9 BILLION.

"WE BUY MORE 0.8. EXPORTS PER HEAD THAN THE EUROPEAN UNION OR JAPAN, AND THE GROWING U.S. INVESTMENT AND TRADE INTERESTS IN THE BOOMING CHINA MARKET ARE TO A LARGE EXTENT MANAGED THROUGH HONG KONG, THE GOVERNOR SAID.

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TRANSCRIPT OF GOVERNOR'S MEDIA SESSION

THE FOLLOWING IS THE TRANSCRIPT OF THE GOVERNOR THE RT HON CHRISTOPHER PATTEN'S MEDIA SESSION AFTER THE AMERICAN CHAMBER OF COMMERCE LUNCHEON MEETING TODAY (FRIDAY):

GOVERNOR:

THINK SHE'LL HAVE A GREAT IMPACT IN WASHINGTON AND MORE TO THE POINT, SO DO THE AMERICANS LIKE THE MEMBERS OF THE CHAMBER OF COMMERCE THAT I'VE BEEN TALKING TO TODAY.

/QUESTION: