TNAG-1268-FCO40-1617-China-s-economic-relationship-with-Hong-Kong-Shenzhen-econom-1983 — Page 74

G.F. 326

43

AL TAX I

55.

(d) Summary

To summarise the present situation, the

relative share of total direct foreign investment

contributed by Hong Kong residents can be regarded as

of crucial importance for Shenzhen SEZ and this may

be so even for Guangdong Province generally.

However, the importance of Hong Kong's share in total

direct foreign investment declines when one comes to

consider China as a whole but is still significant.

Prospects for continued growth of Hong Kong's direct investment in China should be reasonably good provided that; first, the economy of Hong Kong

continues to prosper; and second, China's present pragmatic policy continues.

CONFIDENTIAL #B