6 minutes now past 12 and good afternoon and welcome back to mid-day on Minnesota Public Radio. I'm Gary Acton Clinton administration is reportedly giving China High marks for its hands-off policy in Hong Kong as you'll recall there was lots of concern last year about Hong Kong losing its unique independent status when Hong Kong was returned to China after 99 years of British rule by the administration is officially reported to Congress today. The China has for the most part left. Well enough alone President Clinton is expected to visit Hong Kong when he travels to China this summer last week the US Consul General the Hong Kong Richard voucher was in the Twin Cities to report to the Minnesota meeting on Hong Kong since reunification and also reported how Hong Kong in Asia in general is dealing with the Asian economic crisis broadcast of Minnesota meeting are supported by Oppenheimer wolf and Donley with offices in both Minneapolis, and st. Paul providing legal services to businesses. Around the world. I have particular you want to talk to the 50% of audience members that we surveyed who said they didn't really have a lot of knowledge yet about Hong Kong and Asia in the Far East and what all this means to them because I think a lot of what I try to do when I come back to the United States whenever I go to Washington has to stop in other cities and try to talk to Americans about the opportunities for us out there and try to listen to Americans and hear what you have to say about what you're doing what you're interested in so I can get a better idea of what I can do in my job to further your interest and that's what I really want to do today is to report back to you on Hong Kong and on the situation in the far east as seen from Hong Kong after nine months of the return to the Chinese sovereignty for Hong Kong. If you cast your mind back to June of last year you all remember the anticipation and even the apprehension with which everybody in Asia was looking towards that event the media were intensely focused on Hand over all the major commercial telephone television networks had their star anchors in town and we're broadcasting live from Hong Kong over the intervening 9 months. I guess Hong Kong has attracted very much news coverage in the United States. At least the transition part of it hasn't although I think everybody heard about the bird flu and everybody heard about the financial crisis. Beyond looking at how are interested Fair through Hong Kong through the transition in Hong Kong. I want to look a little bit of Asia is a whole because there's a particular prison is provided by Hong Kong on Asia as is Hong Kong has become the regional Financial Center for a lot of Asia, especially for China but also southeast Asia as well and there's a role of both the United States and Hong Kong can play these would be the financial crisis. Hong Kong indeed has an unmatched ability for making deals happen. They put together the marketing opportunity to technology to manufacturing centers the finance the coordination that make deals work off and across many time zones and many borders Hong Kong entrepreneurs are really turn this city into an international packager for trade and investment projects. They do everything from my beanie babies for the United States to toll roads and power plants in China or southeast Asia in contrast to many of its neighbors Hong Kong is based its success not on government intervention, but rather on the very opposite on a free society and On free markets the principles of principles that have made Hong Kong the success or strict adherence to the rule of law the rules of the market for free flow of information capital in goods and clean efficient non-interventionist government. Before the Hong Kong Handover, the big question was whether this formula for Success would be maintained. No one was sure whether Hong Kong would actually be allowed to enjoy the high degree of autonomy than all areas except Foreign Affairs and defense which have been promised in 1984 in the sign of British joint declaration or a Chinese law in 1990 when they passed what was called the basic law. It's too soon now to pass final judgment on whether these promises will be kept in the long-term, but I have to say Hong Kong is off to a very good start. What they're doing is they're setting a series of right presidents so far basic Liberties have been maintained peaceful demonstrations against the government or a regular picture of our life there. Depress remains free although there is a persistent impression among press and public alike that some editors are reporters or censoring themselves particularly when it comes to news about China or sensitive issues. Like I wanted to bet and yet on those occasions when press freedom in Hong Kong has seemed openly threatened public opinion is made itself known in no uncertain terms and always on the side of an editorial Independence and the expression of different views. The official Chinese Representatives who arrived in Hong Kong at the time of the Handover have kept a low profile. They've given a very strict interpretation to their instructions not to interfere in Hong Kong's local Affairs and the people's Liberation Army which many of you saw on CNN being trucked into song Hong Kong on the night of the hand over have in fact really been seen since then they stick to their garrisons public order and Hong Kong is maintained not by The People's Liberation Army, but by the same police and law enforcement agencies that carry out those responsibilities before the transition. And make no mistake. We do remain concerned about some things and particularly the disbanding of the previously elected legislature and about some aspects of the new election system. However, there is a new election to be held on May 24th all the parties including the strongest Defenders of democracy or gearing up for the elections and despite the odds. The Democrats will get seats and look at a voice in the future of Hong Kong for our part when crocheting the continued Democratic development of Hong Kong just as fast as the Hong Kong people want it that's one of the ways in our mind of ensuring the good government continues into the future. On the economic front Hong Kong maintains, its own membership separate from China's and international organizations including the key places are open trade policies are discussed the World Trade Organization and the asia-pacific economic cooperation Forum Hong Kong speaks out on its own behalf. And we have found usually that Hong Kong's voices in harmony with ours when it comes to support a free trade and cutting out government intervention in red tape. The Hong Kong government is also maintained excellent relationships with all the major law enforcement agencies of the US government today. We fight criminal activities in Hong Kong including drug trafficking money laundering counterfeit credit card fraud illegal immigration Hong Kong customs in cooperation with the US Customs in Hong Kong has seized cars in Hong Kong. They were stolen from the United States and which ended up in containers on the dock sound. Hong Kong is also been very careful about enforcing its laws on export controls even seizing the Chinese off armored personnel carrier that was on his way back into China, but turned up in Hong Kong without the proper paperwork. I think we can truly say that Hong Kong people. That's the new chief executive the same high-quality civil servants. As before are running Hong Kong important administrative and legal precedent supporting Hong Kong's High degree of autonomy are indeed being set and most of them are on the mark. And once the new legislative council is elected this coming May and the current provisional legislature is no more Hong Kong will have a really legitimate legislature and the most blatant impediment to the growth of democratic institutions in Hong Kong will be removed. So if you came to Hong Kong in the coming months, which I hope many of you will you'll see a city that's largely unchanged since July 1st 1997. The most visible difference is that new flags are flying from public buildings. One of the factors that hasn't changed his involvement to the end of the United States in Hong Kong both officially and the private sector past December our American Chamber of Commerce in Hong Kong to the survey a business confidence among the some 1,200 us companies that are there. They found 96% of the respondents were favorable or very favorable about Hong Kong future and about their future in Hong Kong. They found it some 60% We're looking forward to expanding their offices in the next three years and indeed. The number of Americans in Hong Kong has continued to grow we have about fifty thousand Americans now who live in Hong Kong work there and that's almost double what we had 5 years ago. All the indicators of u.s. Involvement remain stable this includes our commercial relationships Financial relationships government-to-government law enforcement cooperation and the continuation of Port calls by US Navy ships in Hong Kong Inn closed over a hundred and fifty thousand Hong Kong people who get visas every year to come to the United States to visit to travel to spend money. It encompasses about 14,000 Hong Kong students in the United States at any moment and the tens of thousands of US units University alumni who have returned to live and work in Hong Kong. But it's not all sweetness and Light. There plenty of issues indeed important issues that are coming up for Hong Kong and for our interests are across-the-board. I would say our primary interest is in is the people in Hong Kong decide these issues for themselves and that they can do this without interference and in keeping with their own Traditions, the first issue is elections and the subsequent question of how democracy of olives in further elections in the Years 2000 2002 2004. 2005-2007 & Beyond then they've got a number of decisions to make about how democracy of olives Second there's a lot to be passed on sedition and secession that we hope will not impinge on any pre freedom of expression in Hong Kong third of the court cases in which Hong Kong's common law courts will have to decide how to interpret some of the legislation under the new system and forth to the big picture issues. How does China evolve and especially how does China evolve in the rule of law? And then how does Hong Kong fit into that process? Not to go for the hard part the economic turmoil. Because of its role as a hung as an International Financial Centre Hong Kong has been a focal point for responding to the ongoing Financial turmoil. It's affecting so many of its neighbors in Asia Hong Kong is not been left untouched by the economic storms to begin buffeting the region during the second half of 1997 indeed the stock market fell 50% last fall remains about 35% below its peak property prices tourism levels and retail sales have all dropped sharply. Hotels and restaurants have seen their business decline has fewer foreign visitors arrive and local people are pinching the pennies there have been speculative attacks against Hong Kong's the Hong Kong dollars Peg to the US dollar but so far it's held the result has been high interest rates, which should have any conomic effect all this is going to produce slower growth this year in the Hong Kong economy. Never less Hong Kong has fared a lot better than many of its neighbors and I think it can be expected to recover sooner than they will. It's economically management fundamentals of the economy have proven sound. Here's some factors to keep in mind Hong Kong has foreign exchange reserves of about 98 billion US Dollars has the third largest in the world and they have no official foreign debt. Hong Kong's current account is roughly in balance and its budget this year will be a surplus of about 1.38 billion US the regulation of Hong Kong's financial markets as a whole has shown itself sound and sophisticated and they continue to rely on free market principles of transparency and competition. When we stop and look at the effect of the crisis on Hong Kong we find in fact a number of outcomes that I'd have to say or positive first the bubbles in Hong Kong, especially the inflated property markets and some stock prices have been adjusted in the fall Hong Kong games and competitiveness as his price of real estate goes down more fundamentally Hong Kong's faith in free markets is being reaffirmed. Its experience has proven. In fact that although countries can isolate themselves from Regional or Global Financial. Although countries cannot isolate themselves from Regional and financial woes sound policies can limit the impact of difficulties. Hong Kong's reputation as an economic Center in his financial autonomy from the central government have actually improved because of the way they've been able to handle the downturn. Well, the property Finance tourism and Retail sectors have been hit hard. There's been less of an effect on manufacturing construction shipping the service sector and trade. The need for Effective Prudential supervision of financial student institutions has indeed been made clear and will probably end up with even better supervise markets than before. So Hong Kong has been able to maintain his position as an important Financial Center for Asia and has a prime Capital Market for Chinese were formed when one looks at the Asian financial crisis from Hong Kong. It's clear that each of the countries has been affected has its own story and there are some common threads but each economy has its own specific characteristics as well the common problem play and privilege protection and Corruption as treasury secretary Ruben observed on March 2nd. All the affected countries had close links between governments Banks and corporations, which led to fundamentally unsound Investments by corporations Finance by unsound lending by Banks. We're over financial institutions like transparency which mask the extent of the problem undercutting the effectiveness of Market discipline. The reforms that are being promoted by the international monetary fund are designed to address these weaknesses and their essential to the full recovery of the region the IMF possessors of an incomparable wealth of expertise technical skills and Financial Resources the IMF contrary to what some might argue has not really offered austerity program. They've rather offered structural and financial reform assistance to those who have requested it. These are TaylorMade programs are designed to strengthen the banking systems increase transparency in supervision Implement appropriate fiscal and monetary policies and the open markets. The net result of these changes is to allow markets rather than political considerations to direct and to Value Investments. The IMF also has the ability to make available temporary financing to give countries Breathing Room in order to restore confidence in their economies. We all know that reform is neither instant nor is it painless only when the nation's themselves adopt serious posture towards economic and political reform will confidence and private Capital really returned to facilitate growth. For us we have to remember that nearly one-third of US exports go to Asia more than we send to Europe we contribute to Asia's regions security through more than a hundred thousand troops 37,000 of them in Korea alone. Because United States is a major provider of funds to the IMF. There's been considerable debate as you know in Congress and elsewhere about whether we would be sending good money after bad and it by making further contributions to the imf's programs for Asian recovery. I think it's becoming clearer and clearer to us though than in today's interconnected world. It's peaches to treat the US economy in the Asian economies as separate entities that have no effect on each other. We shouldn't look upon the IMF programs of some kind of hand out to others. We need to look at it as something that helps our own interest. Asian jobs affect American jobs Asian well affects American well and Asian stability affects American Security We have no choice but to exercise our leadership leadership that derives as much as anything from the fact that we are the world's largest economy and Leadership that arise from our own interest and the economic Vitality of the region just as we protect our own interest in the security area. And that's why you as policymakers since the beginning of the crisis have Focus their efforts on mobilizing and leading and internationally coordinated response to build confidence in the reach. Our aim is to find Solutions which ensuring economic recovery, which is comprehensive structurally sound and sustainable. Interdependence means we must work on an urgent basis with the effect government's with the IMF with other International financial institutions with the private sector. And with the International Community is represented in the Group of Seven Nations, the asia-pacific economic cooperation forum and other places as the region recover from the downturn China's bound to be an important player as well that massive country. As you know is currently undergoing great reform and is charging a truly revolutionary. Kannamma course forward its planning fundamental restructuring of State Enterprises that have formed the backbone of its economic system for 50 years. A likely consequence in China's potentially destabilizing unemployment, but it's also in the process of reorganizing its Banking and its Financial systems as well in the face of Asia's financial crisis. It is pledged not to devalue its currency the UN despite the fact that doing so could potentially make it more competitive with many of the nation's whose currencies of Fallen since last summer. Hong Kong in China or like binary Stars One is small very intense. The other is very large and just finding its glow Hong Kong is now courses special administrative region of China, but its economy has been deliberately kept separate from the economy of the Chinese mainland. Among other things that has and will keep its own convertible currency. Its own foreign exchange reserves. Its border its Customs controls its inspectors its infection stations and its International links. Still as was true before the transition of sovereignty Hong Kong's Prosperity is very closely linked to China's and vice versa more than half of the trade between China and the rest of the world passes through Hong Kong more than half the investment in China, which is become the most dynamic source of growth for the Chinese economy is coming from Hong Kong or via Hong Kong. Hong Kong's intimate economic relationship with the mainland has been crucial to the reform China system over the years and of China's opening up to the wider world. On the other hand China's window on the world has also been important for Hong Kong's development as a prosperous and a Cosmopolitan City. Hong Kong has long been an example for the rest of China and it also stands as an example for the rest of Asia, even though it's essentially just one city of six million people. It can play a pivotal role in Asia and for people like us from the outside its ability so far to a whether the regional economic crisis is in many ways tested Testament to the success of the principles that I mentioned before the rule of law the free-market the free flow of information and clean non-interventionist government. Hong Kong can also play an important role in the in the recovery as an investor in manufacturing Enterprises in the affected countries, and I was a place to raise capital for the recovery. So what does this mean for us? What means that there's opportunities in Hong Kong? And in Asia that we need to explore asset prices are down ways of doing business or changing Hong Kong can play a role for us as a bridge and a packager, but we need to go look for ourselves opportunities in each of the countries of Asia opportunities of different kinds and different sectors opportunities for Acquisitions for manufacturing and even still for sales and introduction of base in a partner in looking at these opportunities. Second we have a role in the process. We can affect the course of events by our cooperation and our involvement weather from the government from Civic groups from academics law enforcement business investors, all the great variety of resources that are available in the United States. So one of my messages take a look. Get involved and stay involved. So let me try to bring together the different threads of thought that tie up what I've been saying today Hong Kong people running Hong Kong as they were promised every committed to this system that they were promised and shown that they're willing to take some risks to maintain their freedoms and our way of life. Everyone knows they're still tough times ahead. But there's a reservoir of confidence in Hong Kong that people will be up for whatever challenges come their way. Hong Kong is not just another Chinese City now it is retained its special atmosphere and its special character through the transition. It's a different city in China from any other one. That's run by Hong Kong Chinese in a very different way from other cities in China. Secondly us interest in Hong Kong or going strong are commercial relationships are law enforcement cooperation are effective cooperation with a Chinese entities in Hong Kong serve us interest and provide us a base for the future the consulate general which I had continues to go about its activities exactly as it did before they hand over as does the American Business community and the many other Americans living and working in Hong Kong and we're there to help you when you come out. On the commercial side the agricultural side or any other side of your business out there. Please get in touch. On The Wider stage of Asia and with particular reference to the financial difficulties here the United States must and has assumed leadership posture working with and through the international monetary fund and other Regional organizations. The recovery of Asia is vital to our national security interest the US and Hong Kong each in their own way in each on their own scale have a role to play in this recovery. Everything depends in the end on the implementation of reforms that will eliminate the weaknesses that have been revealed in these economies tough times ahead for most of the countries involved but the future does hold new opportunities in the context of cleaner more transparent and more market-driven economies. Gus in March of 1998 were in the post transition year in Hong Kong and we begin to see how the historic change has affected politics economics and the people's way of life there we can truly say there were in the post financial crisis. In AZ yet some country seem to have turned the corner other still appear on sure which direction leads to the most full recovery. Let's hope that by March 1999. All the affected countries will be back on the road to economic health and that their people will be enjoying a better quality of life and one that will be underpinned by truly conomic strength. Thank you very much. Thank you Ambassador about your I'm prayer radio audience. You are listening to Ambassador Richard voucher. Who is the US Consul General to Hong Kong? We have a first question here from Richard from John Kaminski who is vice president associate general counsel at Honeywell. I can you use the words Hong Kong people will be running Hong Kong and I'm wondering to what extent do you foresee that the new Hong Kong legislative structure and the rules and processes for elections will result in Beijing having more control over Hong Kong through having more of its chosen representatives in the Hong Kong legislature. And what are the implications of that? I think you have to differentiate between Hong Kong people in politics and Beijing to intervention. What we've seen is the Beijing is not intervening directly. There's none the less a lot of groups in politics in Hong Kong the odd structure of the legislature is in part of Heritage of the British era. It's in part because of decisions made in Beijing. It's in part because of decisions made in Hong Kong in the end Hong Kong people get to vote on the representatives are the structure and the process are you might say tilted in such a way that a certain group of Business and Professional interest tend to be favored and therefore they will end up with perhaps a greater proportion of the legislature than they might have in the general population. But these are people chosen by Beijing so much as people of a particular point of view, which does happen to be Rather close to Beijing. So it's still people live in Hong Kong represented in a kind of distorted proportion in their own legislature. But I think every serious point of view in Hong Kong is going to have their representation there. They're going to have their voices there. Are they going to have a legitimate platform there and that's important to us as well. Our hope is this process will we evolve and then we can encourage it to a ball so that it becomes more and more representative overtime. Thank you. Question is from bar trilok. Who is the vice president of exports for rila companies? Mister Ambassador. Thank you for coming today. My family's businesses in the forest green Wood Products Manufacturing industry in about 25% of our product is exported to Asian to Hong Kong. Most of our customers are actually owned by Taiwanese operating factories with in mainland China and on the outskirts of Hong Kong. So the relationship between Taiwan and China and Hong Kong is very important for us. Could you comment on the current political and economic relationship status between Taiwan and China right now given that two years ago. There were some big bullets firing shells off the coast of a northern Taiwan. Thank you. I think it's easier to answer a question about hardwood flooring if you'd rather do that. Where you at? We had some wonderful American American hardwood on the floor of the embassy Residence Inn Cypress, and apparently you started set off a building wave and we watch the numbers go up next year because everybody came to the house and liked it. So maybe we can do something like that. We do have people supporting exports of US Forest Products out there. The hardwood council is the agriculture. Are you at agriculture Department in some of our Co operators are out there helped him to support the sales of US Forest Products back to the issue of Taiwan and China and Hong Kong where to particularly interesting moment now Taiwan and China both seem to be talkin about talking again. Where Had a fairly quiet. In terms of the level of rhetoric Hong Kong indeed has a position in this relationship because it served to be so Intro instrumental and channeling the investment from Taiwan into the mainland as we all know. There's a whole lot of it there and a whole lot of factories producing some for the US market run by Taiwan companies on mainland China. So it's a particularly complicated situation. I think over time are interested in seeing as we said way back in 72 and we sign to communicate with China are interested in seeing a peaceful resolution of the crisis done by the Chinese themselves on both sides of the straight. So we we kind of watch this very very carefully, obviously it affects our interest but for the moment things are kind of headed in the right direction, it's not our job to push them into anything. It's not our job to tell them what to do. But obviously the more that they can discuss things work them out there the better it will be for all of us. Thank you and best erbacher be the next question from Steve Young. He was an attorney in Minneapolis and was the former on Consul general of Singapore enforcement cooperation. And what are the negative trends that people are starting to comment on is the growth of the Triad criminal organizations. So I'm wondering if you could perhaps give us some assessment as you see it is to the growth of we are stories that they're now the main Triad organization out of Macau is 44000 members around the world is involved in the drug trade from Burma to Thailand Laos Cambodia their men quote on quote the normal business people by middle managers and Senior managers who are Triads Triads are behind the smuggling of people in the United States that are Triad organizations in the states where in our governments are we focusing on this and we penetrated the Triads are we worried about this? We understand it was a growing corruption in China with the economic freedom that the Triads are growing inside. Itself and their traditional Pace was Macallan Hong Kong. Thank you! Should you basket the Triads are a I think and they're they're criminals of secret society along the lines of Italian mafia which evolved out of some ancient for a nineteenth-century of secret societies of Chinese were posing the Manchu Dynasty as you may remember the 19th century China was run by Manchu people and the so-called Chinese are Han people didn't like them. So they put together groups like the Heaven and Earth Society to oppose the Manchu. What's at some point something called Triads began to evolve and their symbol is a triangle of the three corners and there are there criminal Syndicate it exists to make money and they're very involved in the drug smuggling Ambassador I think the whole issue of Triads an Asian organized crime and it's very important to us and we have that's why someone and usually in our consulate we have a lot of law enforcement representation work doing more and more law enforcement efforts overseas and we get people from different agencies to join us, but in Hong Kong we have are drug enforcement agency folks out there. We have the FBI. We have the Secret Service working on counterfeiting money laundering fraud KY questions. We have the immigration Naturalization Service investigating alien smuggling and we're going to get the hope. I didn't leave anybody out, but we're going to get the Internal Revenue Service case anybody's hiding money out there. But a lot of these things come together a lot of other cases that they pursue whether they're specifically organized crime cases or drug smuggling case workers in the kinds of networks that are set up to carry out these crimes. We've always known there's been Drug smuggling from Southeast Asia, it changes patterns some of it's coming through China direct. Some of it comes through Hong Kong Hong Kong still a deal making play some money laundering place. So that's a good place where we pursue these things from we have looked very in-depth at the organized time problems from Asian organized crime and I'm not an expert in it. What I do know is I'm told by the experts it's a little bit different than the centrally conducted organizations that might Operate Now the traditional image of the Italian mafia, for example that there's a bit more of a network feel to it. It's a membership Society in these people kind of do business with each other. And so it's it's it's it's not that they transplant their operations to the US has it operations hook up together and therefore these networks or what we're trying to find out so we can bust the network and not just the, you know, not just a particular person in that location. What happens to be doing it? And in that process we work very closely with a Hong Kong Pearl. Who have their own anti try on Squat and it will have a very strong I'd say knowledge of what goes on in the Triad societies and how they operate and what they're up to and so we have found that cooperation for us to be extremely valuable in terms of getting it the way these networks operate to get you no drugs or aliens or or whatever else. It is to the United States. I'd say it's a problem that is Gotten more attention that deserves the attention that deserves the effort and it's one that is getting the attention of the effort from the US government. We're working on policy levels on money laundering problems were working cop a cop on those levels that we're working with others that can get involved. I don't think I would say there's been an explosion in the level activity. There's been a continuation of a high-level lack of activity that hopefully with the cooperation of others like the people in Hong Kong we can get on and end in oke producing it. Thank you. Mr. Your next question is from Robert White who wants to be introduced as simply as a journalist? Mr. You're out here in the tundra. We sometimes get puzzled about the way the state department of works. You used a couple of examples for your own career and maybe you could Enlighten us. I think we were all impressed by your from the China desk back to China Amanda Department spokesman and so on in Cypress. I wondered where you sent to Cyprus because you would made a lasting peace between China and Taiwan or were you sent back to China because you had made a lasting peace between Turkish and Greek cypriots. Some of us who try to plan. Our careers are also fairly puzzled about how the state department works. Let me let me try to put it this way. I think we view the basic skills of American diplomacy as being the representation of the United States. We're out there because we know and can help Define what US interests are and because we have some basic abilities and knowledge of how to pursue them. And you find when you go from country to country that figuring things out figuring out a strategy looking at who's who figuring out how to get to him and influence him in the right direction. A certain standard sort of ways of going about that that you learn and so that's why we believe that we can apply those skills in different environments. I was fortunate actually to go to Cyprus from having had the spokesman his job because in the spokesman is job you talk about the whole world and don't necessarily understand it all but you do, you know, you do have a basic knowledge of a lot of things and the picture that are ambassadors in our Foreign Service posting Personnel have to go overseas to build is to look at where this place is on the US map where this what it means for us and how we can pursue our interests and that takes somewhat of a broader view. There's a story they tell about secretary Schultz that he used to get new ambassadors into his office after they just been confirmed and say no. Tell me what your country is. Any faster routes were going or Neath The Globe to the smallest level down on the mat and say it's down here sir. And the secretary would spin the globe and stick his finger right in the center of the US and say no that's your country. And I think that's another way most of us feel about it. They were out there to represent the United States we go to different places to do that. Great Ambassador voucher the sponsors of the Minnesota meeting our corporate sponsors help us bring teachers and students from all across the Minneapolis and st. Paul and today we have a group of students from like the high school. They're not going to speak Gerald said he didn't want to ask the question but his teacher Chris Engler who happens to have a little bit more called Fame since we just won the NIT Championship the former Gopher basketball player and a teacher at Lakeville. Any players in Hong Kong? Yeah, but not quite as tall as you. Thank you for coming today. My students are interested in not only the present situation in Hong Kong but as they go through their schooling and begin to perhaps have business contacts in Hong Kong in the future. What do you think the role between the United States and Hong Kong will be in the future. And also what do you think Hong Kong perceives their role as in the future next 5 or 10 years. Thanks. Let me try to go to the Hong Kong side first and then say what it means to the US the Hong Kong side of it is they want to move upmarket and services more into high technology areas. They want to do better application of high technology. You might call it sort of taking the mom-and-pop Chinese company, which is already multinational that exports here and manufacturers there and ships there and modernizing that computerizing it Communications and things like that as they become more high-tech in more depth things. I hope to expand their markets there already big sellers to the United States. We buy a lot of their goods and I think they want to continue to expand that but they also want to move up higher in the area of services and Consulting and design and architecture and things like that. They're already doing quite a bit up and then they will become more and more of a financial center for Asia and for China and they would like to do that on a world scale as well what that means. The United States I think is it is going to be continued place where we can Source Products that we need or we want to import from abroad. It's an excellent market for u.s. Goods. It's there a Chase largest market in the world. I think for a rat overall in it. It's a major buyer for agricultural products and have are processed food products and a lot of industrial raw materials and things that go in there. So it's going to continue to be an excellent market for us what's happened with the transition. I think is it in some ways we've emerged from the Shadows of the British people have realized that the United States has been growing and in our commitment to Hong Kong and our operations there and then in fact we have twice as many Americans in Hong Kong as there are British we have major activity in the stock markets we have become I think the preferred destination for students who come over to United States and who pay what does it cost to go to college but 20 $30,000 a year each go to college in the United States. So I think I only See the interaction between Hong Kong and United States can grow economic interaction the benefits to United States from that but also the things that we do jointly in areas like China and Southeast Asia. Thank you. I next question is from Barbara Thompson. Who is the you tell us we pay with world affairs program director at Minnesota International Center MSU voucher at our table. We were talking about the linkage of human rights to the most favored nation trading status for China and there was a little bit of discussion on that and we think we need a basic primmer. Could you tell us a little bit about first of all what countries have most favored nation status which ones do not what's involved in the process does every country get voted on it annually like China. And what is your position? What is the u.s. Government position on linkage to human rights? This is kind of a quiz on things that I've been doing for 20 years to see if I really understood them from the beginning mfn. Most favored nation status is a bit of a misnomer. It's a nice thing that we used to call. What are the normal tariff rates? And in fact, I think just about every country in the world with one or two exceptions Livia's the only one I think I'm pretty sure gets most most favored nation trading rules and it's basically on the Tariff schedule their says, you know basketballs 2% under the mfn column in a Mesa 30% under the next column, but everybody gets 2% cuz everybody's an event that we may not buy basketballs from Libya North Korea. They have embargoes is superseded. But that's the basic line of tariffs for everybody with everybody else in the world. And it means you're my best friend. In fact, you're all my best friends and that no friend is a better friend. You and so you all get the best tariff rate? Okay now in the In the seventies largely because of the Soviet immigration problems. The Jackson vanik amendment was passed in our Congress and it said that we shouldn't give mfn2 non market economies who don't allow free immigration. And every year if the president gives it there's a review of his granting employment then and so this was a big issue in the 70s and the 80s with Russia Soviet Union. It's time with Romania was a perfectly big one that we debated every year and frankly. Once we gave once we granted mfn to China on that face is the annual Newell's from about 1979. I think it was weren't much of an issue with the Congress has been since 1989. It has become an issue while at the same time most of the countries that previously were non-market became certified as market economies, and we're no longer subject to this. So we have an annual process where the president sends up to Congress and announcement of his intention to continue mfn status for a non-market economy. The Congress review says there is usually a resolution of disapproval that's introduced and that's what gets voted on every year. So you vote for it. You're in favor taking way. I'm a fan you vote against that you're in favor of keeping it my experience since 1979 with China and what I know about my Chinese friends and their lives and how their lives has changed teaches me that the best thing for change in China. The best thing for reform in China has been the involvement of the u.s. Business Community the evolved mint of foreign investment opportunities to travel new ways of doing things the ability to decide which one life is the ability to decide what kind of product you want for dinner or something on the shelves. He actually had to put a personal choice and it to me if you want to pursue a human rights policy. You need to pursue it. Diligently and tuffley and with a steady goal in mind but you don't kick out from yourself, you know, you don't you don't tell the horse to go that way when you're trying to go that way that the foundation of a lot of the change in China has been the opening to the outside world and to me that's represented by having him a fence tabs. Now some of the critics of Emmett and I talked to the folks in Congress as much as I can have said, well, you know, we're not really taking away him. If then we're giving ourselves a right to express ourselves every year on a present China policy song. Just don't like it. Some people do so we bring up the resolution. We have a boat and that's it. I think the problem with that argument is it it's kind of divorced from Real World business. People are out there trying to sell things. They're out there trying to make get the foreigners get the Chinese to buy us products and every year they have the sort of hassle about u s reliability is it as a destination for goods they have this hassle over political debate back in Washington that people in China don't like, so to me that's not helping our business people very much. And so those are the factors that I consider and I would like to see in the future context. I think of future context of getting a kind of Market access in China that we give to China in the United States. I'd like to see him if I made permanent and we can then continue to have our debates about how to pursue a good China policy cuz it's an important issue to us and we need to discuss it. I just think we picked the wrong thing to discuss it with Thank you Ambassador about your next question here from Heather Harden who is an account executive at Dean Witter Heather. Prior to your remarks. This audience was asked to comment on the impact of the Asian crisis on their personal investment portfolios. And if we could gauge the temperature right now is a little Asian flu in this room, but you know in the early 90s the Hong Kong market was the best-performing stock market in the world for about 3 years then about a year ago a lot of investors chose to take their stock Holdings out Hong Kong because they were a little afraid about what would happen during the exchange. But now that the Asian flu has happened. They're asking a new question. I'd like to put to you. They're wondering is it time to go back into the Hong Kong market in begin selectively buying stocks there? That's the question you were asked. How would you answer that one? I think I think the experience of the recent crisis if anything should make people more careful not more careful about getting in cuz there's obviously opportunities and Bargains there but more careful about examining exactly what it is. I think one of the reasons that we had the crisis was a kind of a feeling overseas throw money at Asia, it will come back multiply and almost a feeling in Asia that if you throw money at property it comes back to you multiply and we got into the point where there was a lot of lending a lot of investment property and it didn't pay off and it wasn't bouncing out and it was giving the kind of returns that everybody expected and that in the context of bad banking systems and other things can lead to clap. So this is a moment where we all are to look more carefully and find the real opportunities to do exist. And I agree with you. There are real opportunities now out in Asia for American companies opportunities to acquire things opportunities to manufacture things and even opportunity. Sell things but we need to look closely. Sonny's markets, you know Hong Kong's been an open market is bounced up and down 1982 the Hang Seng Index went from 1700 down 250. That's kind of a tough ride if you're an investor, but then again it came back, you know, 1994-95 when the Fed was Raising interest rates over here the Hang sang drop 40% But again, it came back property markets have gone down 30 40% before and they've gone to astronomical Heights again. So you got to figure out when but there's definite opportunity out there. It's just look closely. Do we have time for two quick questions quick questions and answers a question here from Tony Kowalski. Who's the president of the American Refugee committee? Mister Ambassador, you are portrayed the transition of Hong Kong within the Chinese orbit as initially very successful there other areas within the Chinese orbit that are yet to go through this such as Macau and but I'm thinking more of perhaps troubled areas or troubled relationships. You already mentioned Taiwan, but what about Tibet? Does China have anything to learn from the transition that just took place apparently successfully and applying it to the situation say in Tibet. I don't think we're in a position to draw the conclusions for the Chinese. Certainly. It's too early to draw any conclusions from Hong Kong. and I'm not sure where in any position draw the conclusion for the Chinese about what this means for their policy in Tibet as you know, we Believe like everybody else into bed is part of trying to accept that but we believe the Tibetans could be given a chance to pursue their own culture and their own autonomy, which is been factoring and promised to them in the pan. So I think it's a it's a matter that I have to tend to say that each of these cases is going to be on its own. It's going to have to be appropriate for its own situation. I'm not yet able to say how they're going to relate to each other. I think part of it is that we have been far enough down the road with Hong Kong and it farther down the road with Hong Kong people in other parts of trying to may start to draw some conclusions that are not at all a parent yet. Thank you. Our last question is from Charles Coburn and who is a professor at Northwestern College. Thank you so much for being with us. Con Sabor share my question that we've been talking a lot about economically and I understand the Chinese have a gradualism approach to the reeking Havoc change. But what I like to do is get from you your Insight because of the window that you have a lot of Hong Kong into the political change that's happening inside of China. How do you perceive that you do see that there they made fact heavy transition to some sort of a democratic system. I know in some of their local region and state area as they now have elections. You see that kind of change coming along and otherwise, is there a gradualism and politics as the same as there is a gradualism and economically in China as you see it from your Hong Kong window. I don't I don't think you could say explicitly that there is a gradual reform and adjustment program the kind of an overall program for political reforms there. Is Freakonomics before And whatever it is on the political side their own program is very gradualist in terms of social change. As I said, there's been an enormous change in sort of personal growth personal space personal freedom, even as some of the political repression is continued in China. We're now seeing the beginning of low-level elections being introduced in the in the villages in some of those. Apparently, you're quite interesting. Now, we may see it go up to the county level. We're still a long way from seeing the right of the people to choose their government and there's no particular program that the Chinese government has to do that. So I think a lot of this change comes by the forces of society which are gathering Steam and Gathering I think more in the favor of the lower levels and of the individual being able to decide his own fate, but there's no particular program. It says where it's going to end up and I certainly think if you ask Any of the Communist Party leaders, they would tell you know, it's not going to end up there. But there's a lot of social change in China and some ways that is very important to political personal freedom political freedom and eventual social change in China. Richard Belcher the US Consul General to Hong Kong speaking last week at the Minnesota meeting in Downtown Minneapolis broadcast. Minnesota meeting are supported by Oppenheimer Wolff and on lake with offices in both Minneapolis and st. Paul providing legal services to businesses around the world. That doesn't permit Day program Gary I can hear thanks for tuning in. Benson on the next All Things Considered will have the latest on the battle over releasing confidential internal. Tobacco industry documents. It's all things considered weekdays at 3 on Minnesota Public Radio know FM 91.1 You're listening to Minnesota Public Radio. We have a cloudy Sky 42° at Kennedy Avenue FM 91.1 Minneapolis. And st. Paul. It's going to be cloudy all afternoon. The Weather Service says we can look for maybe some light snow or light rain high-round 40° where it is Jasper some flurries tonight partial clearing tomorrow with a high near 50. From NPR news in Washington, I'm Ray Suarez in this is Talk of the Nation. Second thoughts about helping others with a part of yourself and egg. I wish I knew if it works. I wish I knew if there was a child that was going to be born in April when I see children, sometimes I think about whether or not if and when this child is born if it'll be taken care of. Well if who the parents are because I never knew anything about them action was complete is any Offspring really in some way hers the debate surrounding the collection and use of donated human eggs to help those with