"One Country, Two Systems" has basically developed smoothly in Hong Kong since its return to the motherland, and the region continues to enjoy its advantages of pluralism, freedom of expression and many others, Consul General of Japan at Hong Kong Takanori Kitamura said Monday.

Addressing a luncheon held by the Rotary Club of Wanchai, Kitamura went on to say that Hong Kong's future status depends very much on its economic strength. Without its economic strength and competitive edge, Hong Kong will not be able to maintain the merits it enjoys today, he warned.

He made clear that Japan attaches great importance to Hong Kong's status as a world financial center and as an indispensable economic partner. According to him, Hong Kong is one of the top five export destinations for Japanese products, while Japan is Hong Kong's third largest trading partner.

There are about 2,100 Japanese companies in Hong Kong, 198 of which have operated in Hong Kong as regional headquarters by the end of June 2004. The figure of Japanese companies setting up regional headquarters in Hong Kong is second only after the United States on a country-by-country basis, he noted.

He stated that the Japanese community is planning a proposal to celebrate the next year, 2005, as Japan-Hong Kong Year, to commemorate the 50th anniversary of the Hong Kong Japanese Club, the biggest Japanese organization in Hong Kong.

The proposed program will encompass the sectors of culture, tourism, economy and education, with a view to enhancing friendship and mutual exchanges between Hong Kong and Japan, the consul general said.