TNAG-2608-FCO40-3799-International-support-from-the-USA-regarding-the-future-of-H-1992 — Page 72

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CONTINUE, THAT DEMOCRATIZATION ADVANCES, AND THAT THE U.S. RELATIONSHIP WITH HONG KONG BE PRESERVED AND STRENGTHENED.

BEFORE 1997, IT IS PRIMARILY INCUMBENT ON THE PRC AND THEBRITISH GOVERNMENTS TO TAKE THE NECESSARY STEPS TO PRESERVE HONG KONG'S ESSENTIAL CHARACTER; AFTER 1997, THAT TASK WILL BE CHINA'S ALONE. OBVIOUSLY, HOW CHINA EXERCISES ITS SOVEREIGNTY OVER HONG KONG WILL AFFECT AMERICAN ATTITUDES TOWARDS CHINA.

HONG KONG-PRC ECONOMIC RELATIONS

CHINA HAS SUBSTANTIAL INTERESTS AND COMPELLING INCENTIVES

TO RESPECT ITS OBLIGATIONS AND SEEK TO PRESERVE THE CONDITIONS

THAT HAVE ALLOWED HONG KONG TO PROSPER.

KONG'S SUCCESS IS CONSIDERABLE:

CHINA'S STAKE IN HONG

CHINA HAS A CLEAR AND GROWING ECONOMIC STAKE IN HONG

KONG'S CONTINUED PROSPERITY: THE PRC IS THE LARGEST FOREIGN

INVESTOR IN HONG KONG, AND HONG KONG IS THE LARGEST SOURCE

OF FOREIGN INVESTMENT IN CHINA, AND AN IMPORTANT ECONOMIC

AND FINANCIAL ENTREPOT TO THE OUTSIDE WORLD.

THE ECONOMIC INTEGRATION OF SOUTH CHINA WITH HONG KONG

HAS BEEN KEY TO THE REMARKABLE SUCCESS OF THE SPECIAL

ECONOMIC ZONES (SEZ) ADJACENT TO HONG KONG AND THE PEARL RIVER DELTA WHICH HAS MADE SOUTH CHINA AN ENGINE OF CHINESE

ECONOMIC GROWTH.

CHINA VIEWS ITS SUCCESS IN HONG KONG AS SOMETHING THAT