Hong Kong: basic principles

Article Abstract:

Hong Kong may be loosening links with the US and its economy becomes more closely linked to that of China. The China economy may emerge from its austerity program in 1997, helping Hong Kong. Hong Kong Monetary Authority's chief executive, Joseph Yam, has sought to reassure investors on the impact of the handover to China. Yam argues that Hong Kong will retain autonomy and mainland interests will not be favored in Hong Kong. The impact of this optimistic view on investors has yet to be assessed.

Economic aspects

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Topsy-turvey

Article Abstract:

Hong Kong financial markets have been affected by problems elsewhere in Asia, and the Hang Seng index has recorded a drop. The response to China Telecom's flotation will affect the performance of the stock market. Opinion is divided on how Hong Kong stocks will perform. Merrill Lynch is more of an optimist and sees Hong Kong economic fundamentals as strong. Goldman Sachs is optimistic and Morgan Stanley calls for more caution due to concerns about a possible slowdown in mainland China.

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Hong Kong: red but still very much alive

Article Abstract:

The handover of Hong Kong to China should not have a major impact on investments in Hong Kong because it is in China's interests to preserve Hong Kong's economy. Hong Kong companies plan investments in mainland China and a successful aftermath of the handover could help China in its bid to persuade Taiwan to accept rule by China. There are still risk factors such as the possible impact of a rise in the US dollar and a possble peak in real estate prices.

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