Most Favored Nation status critical for Hong Kong future
An Analysis
June 11, 1997
Web posted at: 2:38 p.m. EDT (1838 GMT)From Hong Kong Bureau Chief Mike Chinoy
HONG KONG (CNN) -- The lifeblood of Hong Kong is trade, especially with China. Nearly half of all the goods shipped in and out of China pass through the territory -- one of the reasons why its container port is the busiest in the world.
In addition, 50 percent of all U.S. trade with China goes through Hong Kong, making China and the United States the territory's two largest trade partners.
That is why the calls in the U.S. Congress to revoke China's Most Favored Nation trading status -- the low tariffs Washington offers its normal trading partners -- are generating concern here, especially on the eve of Hong Kong's handover to China.
"Hong Kong really survives in the middle between America and China," said James Tien of the Hong Kong Chamber of Commerce. "If either of them has a sneeze, we will catch a cold or pneumonia. So we're very concerned about the trading relationship between China and the U.S."
Official studies indicate that if MFN for China was revoked, Hong Kong's economic growth rate would be cut almost in half and unemployment would soar.
"We'll probably be talking about a loss of jobs of about 300,000 out of 6 million people," Tien said.
Officials are so concerned about the possible loss of MFN that diplomats from all sides of the political spectrum have voiced their opinions, from pro-Beijing politicians to outgoing Hong Kong governor Chris Patten to pro-democracy politicians.
"We have always taken the view that MFN should be renewed because if it is not ... it's not helping Hong Kong," said Martin Lee of the Hong Kong Democrats.
Richard Boucher, U.S. consul-general to Hong Kong, also underlined the importance of the trading status renewal.
"This is really important for Hong Kong to maintain their prosperity. And that trade, particularly with their two biggest trading partners -- the U.S. and China -- is really important for them to maintain their society, their way of life and their economy as they go into this new era."
- Newsmaker Profile: Jiang Zemin - Chinese President
- Newsmaker Profile: Tung Chee-hwa - Hong Kong Chief Executive Appointee
- Video Almanac: 1984 - Hong Kong transfer agreement
- Newsmaker Profile: Tony Blair - British Prime Minister
- Newsmaker Profile: Madeleine Albright - U.S. Secretary of State
Related stories:
- U.S. to boycott seating of new Hong Kong legislature - June 10, 1997
- Future restrictions on Hong Kong liberties eased - May 15, 1997
- Mainland Chinese flee to Hong Kong before handover - May 14, 1997
- Hong Kong's governor blasts plan to dilute civil liberty laws - January 20, 1997
- Friction rising between Hong Kong's present and future leaders - December 10, 1996
- China warns that political protests may not be allowed in Hong Kong - October 23, 1996
- Governor defends Hong Kong democracy in final speech - October 2, 1996
- Hong Kong: Fears, cheers about China's takeover - June 30, 1996
Related sites:
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- Hong Kong 1997 Web Site
- Hong Kong Government Information Centre
- Hong Kong Government Economic and Trade Office
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