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Following his meeting with Mr Kono in the morning, he arrived at the Tokyo Kaikan to meet some of the Japanese leading businessmen in a reception before addressing a luncheon hosted by the Japan/Hong Kong Society, Hong Kong/Japan Business Co-operation Committee, Hong Kong Trade Development Council and Hong Kong Economic and Trade Office.

Speaking to more than 600 guests attending the luncheon, the Governor listed Hong Kong's achievements since he last addressed the gathering only two years ago.

Hong Kong's per capita GDP was overtaken that of Australia, Canada and United Kingdom; Hong Kong has moved up from being the 10th largest trading entity in the world to the eighth; Hong Kong is now into its 34th year of economic growth; since 1992, 153,000 new businesses have been set up in Hong Kong and over 700 more foreign companies registered there, taking the total to 3,900.

Noted that the growing economic relationship is matched by growing human contacts, Mr Patten said the number of Japanese living and working in Hong Kong has gone up from 14,000 to 20,000; 10 years ago it was only around 7,000.

"Trade between Japan and Hong Kong now totals about US$20 billion. About 11 per cent of Hong Kong total's global trade," he said.

"You are the biggest external investor in our manufacturing sector. Your investment in Hong Kong industry is worth about US$2 billion. One in four of our banks in Hong Kong are Japanese-owned."

Japanese companies are also playing a leading role in helping Hong Kong to build for the future.

"Twenty-six per cent of all the largest infrastructure projects associated with the new airport projects have gone to Japanese companies," Mr Patten said.

Turning to the question of whether Hong Kong will continue to prosper after 1997, the Governor said he was optimistic it would provided that the Joint Declaration was sustained, which underpinned the concept of one country, two systems.