TNAG-1622-FCO40-2236-Relations-between-Hong-Kong-and-China-1987 — Page 20

OUTLOOK

CONFIDENTIAL

14. The underlying problem for the leadership is to decide what kind of economic system it wants. Having abandoned economic Maoism

and economic Stalinism it has to decide how far it wants to go

towards a market system, particularly in the areas of planning and

prices.

15. Meanwhile, however, the China market remains a promising one

for British industry. The IBRD has projected imports worth between US $ 223bn and US $ 290bn in the year 2000 (in 185 prices assuming

international inflation at an annual average of 5.6%). If the

United Kingdom could increase its market share from 2% now to 5%

then, the China market would indeed have become a significant one.

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CONFIDENTIAL