US investments in China in 1983 totaled roughly $85 million, there are more than 20 joint ventures between the US and Chinese investors. In addition, over one-half billion dollars have been invested by US corporations in offshore oil exploration.

There are reasons to be optimistic and to expect that commercial and financial relationships will grow in the future. But there are also difficulties to be resolved. Let me first address reasons for expecting growth and then discuss the problems.

After a period of dramatic shifts in economic policy, China has decided on a stable and promising economic course. It is aimed at adjusting the pace of modernization to China’ s resource capabilities and its goal of major increases in employment, providing incentives for agricultural and industrial productivity; strengthening light, labor intensive industries, using technology to modernize and promote the technological transformation of existing industries; and removing bottlenecks imposed by energy and transportation constraints.

In many of these areas, particularly agriculture, the results have been very positive. Food production is increasing rapidly. Modernization of industrial production is occurring throughout the country, and production units are merging to achieve important economies of scale. Economic growth has been roughly 10% although it is faster in heavy industries and slower in some light industries than hoped for. I believe Chinese economic authorities recognize the problem and the next Five-Year Plan will address it effectively.