One thing which gives the Hong Kong Chinese faith in the future of their city after the British depart in June is the way Beijing has honoured its treaty obligations. Despite overwhelming military superiority and a dislike of the Opium Wars that ceded the colony to Britain in 1840, they explain, China has always resisted any temptation to annex Hong Kong. A similar attitude is expected in upholding the Sino-British accord governing Hong Kong to 2047.

While there is much speculation over its ability to flourish after the British withdrawal, Hong Kong has in reality always been greatly assisted by mainland China's policies, investment and co-operation. Out of Beijing's forbearance, say many analysts, has grown enormous economic inter-dependence between this remarkable territory and its mighty neighbour to the north. Which augurs well for its future.

Britain's last and most controversial governor to Hong Kong, Chris Patten concurs: "I am optimistic (about Hong Kong's future) because it is so massively in China's interest that things should go well... Chinese officials must recognise that continued success in China's richest city, its bridge to the world, the source of most of its inward investment and the target for most of its outward re-investment is crucial to the future well-being of China."

Having survived the turbulence of China's recent past - most notably the Cultural Revolution - Hong Kong has flourished like nowhere else on earth. When the colonial government began calculating GDP in 1961, for example, it was HK$7 billion; today it is $1,11 l billion or 21 per cent of China's. Yet its population is only 0.5 per cent that of its mighty neighbour. Similarly, per capita GDP has skyrocketed from HS$410 in 1961 to $23,210 today.

From a sleepy backwater swamped by mainland refugees in the 1950s, therefore, Hong Kong has risen to become the world's eighth largest trading community. Other impressive indicators abound: it has the world's seventh largest financial reserves, the eighth largest stock market, and the fifth largest foreign exchange market. It also has the world's largest container port and its third busiest airport. And when fully operational, its new 24-hour Chek Lap Kok airport will be the world's second busiest.

Article 5 of the Basic Law agreed by Beijing and London as a way of maintaining Hong Kong's unique business culture after 1997 stipulates that China's socialist system and policies will not be practised in the Hong Kong Special Administrative Region, and the previous capitalist system and way of life shall remain unchanged for 50 years." The other 158 articles guarantee, among other things, freedom of speech, continued use of common law and of the English language.

Other safeguards likely to interest ITBG readers are those in Article 31 guaranteeing Hong Kong's 6.2 million inhabitants freedom of emigration to other countries and "the freedom to travel and the freedom of entry and exit". There seems little doubt, therefore, that a mutual Sino-British desire to maintain the status quo ante will continue to attract visitors and business travellers in increasing numbers and, similarly, to generate outbound Hong Kong traffic in sizeable proportions after 1997.

This is underpinned by Britain and its European Union partners - not to mention the USA and Japan - who wish to maintain strong economic and diplomatic links with Hong Kong after 1997. Hong Kong already handles 50 per cent of all EU trade with China and has had its own mission in Brussels since 1965. Similarly, the EU reinforced its role in Hong Kong by opening a mission in October 1993. "We have 50,000 EU nationals living here and 115 European companies working on the new airport alone," says EU representative Etienne Reuter.

"Britain's tangible stake in Hong Kong is massively greater than anywhere else in Asia," adds its senior Hong Kong trade commissioner Francis Cornish. The most visible sign of this ongoing presence has been the establishment of Britain's largest ever consulate-general whose duties include servicing Hong Kong's three million British passport holders and overseeing the transition process until the year 2000.

Hong Kong is Asia's most popular travel destination. In 1995, a record eight million international visitors came to the territory plus another 2.2 milion from Hong Kong's future landlord, the People's Republic of China. After textiles and garments, therefore, tourism is the economy's largest foreign exchange earner which in 1995 accounted for eight per cent of GDP with total receipts (including those from China) worth HK$75 billion. According to the Hong Kong Tourist Association, it also accounts for some 200,000 jobs or about six per cent of the workforce.

Based on current forecasts, Hong Kong expects to welcome between ten to 12 million visitors annually by the year 2000 and generate receipts between HK$120-140 billion. While the government acknowledges tourism's economic benefits and is mindful of the huge investment in its new airport (HK$70 billion), there is also an awareness of the territory's deteriorating environment and the contribution 12 million visitors could make to this problem.

None of this, however, is curbing the scale of investment in new visitor infrastructure. At the end of 1995, Hong Kong had 86 hotels (33,052 rooms) with another 5,996 rooms due to be added by the end of 1999, which will compensate for the closure of nine hotels (3,500 rooms) between January 1993 and June 1995. "The tightness in room supply, air traffic congestion and strong regional competition are all factors affecting Hong Kong's tourism industry," notes HKTA Executive Director, Amy Chan. "'The Visitor and Tourism (VISTOUR) Consultancy Study' was commissioned by the HKTA in 1995 to identify the way forward for Hong Kong. Based on the results we have developed a strategy to prepare for the huge growth in tourism worldwide and to adapt to the changing profile and needs of Hong Kong's visitor."

As a leading business centre, Hong Kong is also a major venue for conferences and exhibitions. Much of this is focused on the Hong Kong Convention and Exhibition Centre with its superb harbour position and walkways leading to many of the city's hotels, the Mass Transit Railway and the Kowloon ferries. Looking optimistically to the post-1997 era, the government is investing US$620 million in doubling the centre's capabilities to 247,936 square metres by the middle of this year enabling continuing growth in the market for major international conferences and exhibitions.

Against this backdrop of growth and inward investment, Hong Kong will remain a major destination for Asian and western business travellers. As now, many will be primarily interested in Hong Kong as a gateway to China and a place where knowledge of its vast markets is abundantly available. While the flags may change, therefore, Hong Kong's dollar will remain pegged at parity with the US dollar and the immigration procedures little altered. In the longer term, however, Hong Kong is certain to become a more integral part of China. Huge rewards will be in the offing for those who invest and live there. Many China experts believe this is likely to result in more Hong Kong influence in China than vice-versa.