TNAG-0741-FCO40-945-Relations-between-China-and-Hong-Kong-1978 — Page 110

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DSR 11C

also set-backs, but under Chou En-lai's direction the

harm done to the Chinese economy by the Great Leap

Forward and by many of the excesses of the Cultural

Revolution was partially repaired. Chou's and Mao's

deaths were followed by the overthrow of the more

extremist members of the leadership (the Gang of Four)

and the return as Deputy Prime Minister of the highly

pragmatic Teng Hsiao-ping. The new leadership may be

subject to further changes, but its general policy seems

well established. This will give new impetus to the

long-declared aim of China's leaders of achieving

comprehensive modernisation of the Chinese economy by

the year 2000, and to make. China one of the leading

industrialised nations. Her GNP has grown by 5-6%

annually and her industrial production by 10% annually

over the last twenty years; this rate of development

is likely to continue, bringing her GNP to three times,

and her industrial production to seven times, their

present levels in the next 20 years.

External Economic Relations

4. China's foreign trade is expected to grow in real

terms at about the same annual rate as the past 20

years (5-6%), and will therefore triple over the next

20 years.. Trade will maintain about the same proportion of GNP (4-5%). Imports (from non-Communist countries).

of iron and steel, foodstuffs and fertiliser, accounting

for about 40% of total imports in 1976, are expected to

/decline

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