TNAG-1871-FCO40-2659-Relations-between-Hong-Kong-and-China-1989 — Page 100

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7. The meeting was made possible by the financial support of the United Nations Development Program and of the Ford Foundation, with additional grants from the Carnegie Council for Ethics and International Affairs and from Pepsico Inc.

I. Background and Purpose.

8.

China has reached a critical stage in the process of rapid modernisation. A number of fundamental and complex transformations are all in progress at the same time. The country is moving, with inevitable problems, from a centrally-planned economy towards a "socialist market economy." It is also engaged both in massive

restructuring and in a rapid process of economic liberalisation. And it has changed in only ten years from a closed to an open economy. Indeed, international inputs are now expected to make an essential contribution to modernisation.

9. China is committed to strengthening its links to the rest of the world, through political relations, trade, investment, training and research and the exchange of ideas. There are now extensive international contacts at all levels, and there is a growing capability within China for high quality research on domestic and international issues.

10. A substantial change in political leadership was accomplished in March 1988. The Chinese leaders, who will now guide their country through the next complex and difficult phase of modernisation, are well aware that external, international events will have a major impact on the successful development of their country They also recognise that their own decisions are of increasing importance in world affairs.

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11.

In July 1987, the leadership decided to obtain advice and opinions from outside China on international trends and developments. This initiative formed part of the overall effort to define a development plan for China for the next decade. They took the unusual step of convening a private and entirely informal meeting so that the advice, the ideas and the exchange of experience would be clear and direct. The international participants were invited officially by the Chinese government, but in their personal capacities.

Annexes 1&2 list the Chinese and international participants.