ABSTRACT
Economic reforms have led to a resumption of outward economic contacts between Mainland China and the rest of the world. As the windows of the country, Hong Kong and Macau, especially the former, were immediately affected by this liberalization process, which not only strengthened the role of the territories as middlemen or stepping stones of China, but also accelerated the economic restructuring process of Hong Kong and Macau to evolve from industrial-oriented to series-oriented economies. Following the economic reforms, an intensive economic tight has been formed betweenMainland China, HongKong andMacau, and the ‘China factor’ has become a dominant component in the economic growth and development process of Hong Kong and Macau. Furthermore, the economic reforms of Mainland China have posted significant economic impacts to the other side of the Taiwan Strait. Despite the absence of direct transportation and communication, given the liberalization policies, Taiwanese businessmen have invested increasing amounts in Mainland China and have utilized the special administrative regions (SARs), particularly Hong Kong, to deliver immediate goods to Mainland China for further processing. As a result, the SARs are able to derive benefits from the indirect economic transactions between Mainland China and Taiwan, enhancing further the extent of economic integration between Mainland China and the SARs.
