A balanced analysis of a sensitive subject: Hong Kong's future prospects.

Hong Kong in Focus - Political & Economic Issues

Hong Kong will revert to Chinese sovereignty on July 1,1997, after over a century of rule by the United Kingdom. As the reversion date approaches, increasing attention has focused on how the territory will fare under China and how U.S. economic and security interests could be affected. U.S. economic presence in the territory is substantial, and Hong Kong's fate has significant implications for broader U.S.-China relations. You asked us to focus on one key issue-whether U.S. export control policy toward Hong Kong will adequately protect U.S. national security and nonproliferation interests after Hong Kong's reversion to China. You raised concerns about the potential risks and consequences of continuing to export sensitive technologies to the territory after reversion, given China's past proliferation behavior. This report outlines (1) how U.S. export controls are currently applied to Hong Kong as compared with China, (2) planned U.S. export control policy toward Hong Kong after reversion, and (3) possible safeguards and monitoring efforts to protect U.S. nonproliferation interests.