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Administrative Division
          China's administration is currently based on a three-level system
          dividing the nation into administrative units of three different
          sizes: provinces, counties, and townships. The entire nation is
          divided into provinces, autonomous regions, or municipalities
          directly under the Central Government. A province or an autonomous
          region is in turn subdivided into autonomous prefectures, counties,
          autonomous counties, and/or cities. A county or an autonomous county
          is again divided into townships, national minority townships, and/or
          towns. Autonomous regions (equi-valent to provinces), autonomous
          prefectures (between autonomous regions and autonomous counties),
          and autonomous counties are all autonomous ethnic minority
          governmental units. The Constitution specifically empowers the state
          to establish special administrative regions when necessary. A
          special administrative region is a local administrative unit
          directly under the Central Government.
              Administrative Units
              As of July 1, 1997, China is divided into 23 provinces, five
              autonomous regions, four municipalities directly under the
              Central Government and one special administrative region.  
              The Capital
              Beijing is the capital of the People's Republic of China. It is
              not only the nation's political center, but also its cultural,
              scientific and educational heart and a key transportation hub.
              Beijing has served as a capital for more than 800 years. The
              city has many places of historic interest and scenic beauty,
              including the Imperial Palace (also known as the Forbidden
              City), the largest and best-preserved ancient architectural
              complex in the world; the Temple of Heaven, where Ming and Qing
              emperors performed solemn rituals for bountiful harvests; the
              Summer Palace, the emperors' magnificent garden retreat; the
              Ming tombs, the stately and majestic mausoleums of 13 Ming
              Dynasty emperors; and the world-renowned and genuinely inspiring
              Badaling section of the Great Wall. Large-scale construction
              since the founding of the People's Republic of China in 1949 has
              brought great changes to Beijing. Today's Beijing still retains
              the alluring fascination of an ancient capital, but has added a
              small forest of skyscrapers and a complete range of municipal
              facilities, transforming itself into an attractively modern
              metropolis redolent of history.  
              The Founding of the Hong Kong Special Administrative Region
              The area constituting Hong Kong is located on the southeast
              coast of China, east of the mouth of the Pearl River and
              bordering Guangdong Province. It consists of Hong Kong Island,
              Kowloon, and the New Territories. Hong Kong has been Chinese
              territory since ancient times. In 1840 Britain provoked the
              Opium War, invading China, and subsequently forcing the Qing
              government to sign the "Treaty of Nanking" in 1842 ceding Hong
              Kong Island. In 1856 Britain initiated the Second Opium War with
              the result that the Qing government was forced to sign the
              "Treaty of Peking" in 1860, ceding the southern end of the
              Kowloon Peninsula south of Boundary Street. Following the
              Sino-Japanese War of 1894, Britain took advantage of the other
              imperialist powers' scramble for carving up China and forced the
              Qing government in 1898 to sign the "Convention for the
              Extension of Hong Kong Territory" that compelled China to lease
              Britain the vast northern section of the Kowloon Peninsula,
              north from Boundary Street to the Shenzhen River, and more than
              200 nearby islands (afterwards, collectively known as the "New
              Territories". This 99-year lease l expired on June 30, 1997.
              These three treaties were all coerced by the British
              imperialists' armed invasions and the Chinese people have never
              recognized them. Since the founding of the People's Republic of
              China in 1949, the Chinese Government has time and time again
              clearly stated its position on the question of Hong Kong: Hong
              Kong is a part of Chinese territory and China refuses to abide
              by the terms of these unequal treaties, signed between the
              British and Qing governments. While recognizing this historical
              legacy, China has consistently held that at the appropriate time
              a negotiated, peaceful solution to the problem will be found;
              until that time, the status quo will be maintained.
              In 1982, Deng Xiaoping presented the concept of "one country,
              two systems" stating that perceived difficulties presented by
              Hong Kong's return to China could be greatly ameliorated through
              the implementation of a "one country, two systems" policy.
              Between July 1983 and September 1984, delegates from both
              Chinese and British governments held 22 rounds of talks, before
              formally signing the "Joint Declaration of the Government of the
              United Kingdom of Great Britain and Northern Ireland and the
              Government of the People's Republic of China on the Question of
              Hong Kong" in Beijing on December 19,1984. The Joint Declaration
              clearly states that the Government of the United Kingdom will
              restore Hong Kong to the People's Republic of China and the
              Government of the People's Republic of China will resume
              sovereignty over Hong Kong effective July 1st, 1997.
              On January 26, 1996, the Preparatory Committee of Hong Kong
              Special Administrative Region was set up, marking that the
              preparatory work for the Chinese Government to resume the
              exercise of sovereignty over Hong Kong has come to the last
              stage. The Committee is an organ of power and a working organ as
              well. Its main task is to set up the first-term government and
              legislative organ of the Hong Kong Special Administrative
              Region. The Committee's work was mandated by the Basic Law of
              the Hong Kong Special Administrative Region of the People's
              Republic of China approved at the Third Session of the Seventh
              National People's Congress on April 4, 1990, and other relevant
              decisions. On December 16, 1996 Tung Chee Hwa was elected the
              first Chief Executive-designate of the Hong Kong Special
              Administrative Region (SAR) and was appointed by the Central
              Government the first Chief Executive; on December 21, 1996 the
              60-member Provisional Legislature of the Hong Kong SAR was
              formed through elections, and Rita Fan Hsu Lai-tai was elected
              president of the Provisional Legislature on January 25, 1997;
              and on February 20, 1997 the 23 candidates nominated by the
              first Chief Executive for the major positions in the first Hong
              Kong SAR government were also appointed by the Central
              The Hong Kong Special Administrative Region officially
              established on July 1, 1997 exercises a high degree of autonomy,
              and enjoys executive, legislative and independent judicial power
              including that of final adjudication. The major organs of power
              of the Hong Kong SAR are the Chief Executive, the Government,
              the Legislature and the Court of Final Appeal. In addition,
              there is the Executive Council, a body which assists the
              decision-making of the Chief Executive, and the Commission
              Against Corruption and the Commission of Audit, which function
              independently and are accountable to the Chief Executive. Under
              the Government, the executive power organ of the Hong Kong SAR,
              there are the Department of Administration, the Department of
              Finance, the Department of Justice and various bureaus,
              divisions and commissions.  
              Located to the west of the Pearl River estuary in Guangdong
              Province, 40 nautical miles to the west of Hong Kong, Macao's
              17.5 square kilometers of territory comprises the Macao
              Peninsula, Taipa Island and Coloane Island. In 1553, the
              Portuguese bribed local government officials in Guangdong to
              gain permission to drop anchor in Macao's harbour and engage in
              trade. In 1557, the Portuguese began to settle nearby. In the
              period following the Opium War of 1840, taking advantage of the
              weakness of the debilitated Qing government, the Portuguese
              successively seized Taipa and Coloane islands to the south of
              the Macao Peninsula. In 1887, the Portuguese government forced
              the Qing government to sign the "Draft Agreement of the
              Sino-Portuguese Meeting" and subsequently the "Sino-Portuguese
              Treaty of Peking" which included the statement that: Portugal
              should administer Macao and subordinate areas in perpetuity, as
              any other region governed by Portugal. Since that time, Portugal
              has occupied Macao. The Chinese people have never recognized
              these unequal treaties. The government of the People's Republic
              of China has repeatedly enunciated the fact that Macao has
              always been a part of Chinese territory. As with the Hong Kong
              issue, China has consistently maintained that at the appropriate
              time a peaceful, negotiated solution to this problem inherited
              from the past should be found. When diplomatic relations were
              established between China and Portugal in 1979, the Portuguese
              government formally recognized Macao as Chinese territory and
              the two sides agreed that the question of Macao should be solved
              through bilateral negotiations in due time. Between June 1986
              and March 1987 delegations from the two governments held four
              rounds of talks. Finally, on April 13, 1987, the "Declaration on
              the Question of Macao by the Governments of the People's
              Republic of China and the Republic of Portugal" was formally
              signed in Beijing. The Joint Declaration includes the
              formulation: "The Government of the People's Republic of China
              will resume sovereignty over Macao effective December 20, 1999."
              When the time comes, the Macao Special Administrative Region
              will be established.  
              Taiwan Province
              Located to the southeast of the Chinese mainland opposite Fujian
              Province, the island province of Taiwan is flanked by the
              Pacific Ocean to the east and the Taiwan Straits to the west.
              Covering an area of 36,000 square kilometers, Taiwan comprises
              China's largest island, Taiwan Island, and more than 80 other
              smaller neighboring islands and islets, the largest of which is
              the Penghu Islands. Taiwan was called Yizhou and Liuqiu in
              ancient times. Taiwan's early development by the Chinese people
              has been recorded in many historical books and documents. The
              Chinese governments through the past ages set up administrative
              organizations to exercise its jurisdiction over Taiwan.
              Traditional Chinese culture has been continuously passed on
              during the development of Taiwanese society, even during the 50
              years of Japanese occupation. After the Chinese people won the
              War of Resistance Against Japan in 1945, the Chinese Government
              restored the administrative organs of Taiwan Province. On the
              eve of the founding of the People's Republic of China in 1949,
              the Kuomintang authorities retreated to Taiwan from the
              mainland. In 1950 the Korean War broke out and the United States
              dispatched its Seventh Fleet to invade Taiwan and occupy the
              Taiwan Straits. In 1954, the government of the United States and
              the Taiwan authorities signed a "Defence Treaty" bringing about
              the separation of Taiwan from the mainland.
              The Government of the People's Republic of China has made
              unremitting efforts towards solving the question of Taiwan and
              realizing the reunification of the country. In February 1972,
              President Richard M. Nixon of the United States visited China
              and the two sides issued the Shanghai Communique. On January 1,
              1979 the United States joined in establishing diplomatic
              relations with China, declaring formal recognition of the
              government of the People's Republic of China as the sole
              legitimate government of China and, at the same time, announcing
              the cessation of "diplomatic relations" with the Taiwan
              authorities, the termination of the "Mutual Defence Treaty" and
              the withdrawal of all its military personnel from Taiwan. Under
              such historical conditions, taking the whole nation's interests
              and future into consideration, the Chinese Government put
              forward a policy of "peaceful reunification, and one country,
              two systems" based on the principles of respecting history and
              present realities, seeking truth from facts and giving
              consideration to interests of each party. The basic points of
              this policy are as follows: (1) One China. There is only one
              China in the world, Taiwan is an inseparable part of China, and
              the seat of the Central Government is in Beijing. (2) Two
              systems will coexist. under the precondition of one China, the
              socialist system in mainland China and the capitalist system in
              Taiwan will coexist and develop simultaneously. (3) A high
              degree of autonomy. After the country is reunited, Taiwan will
              enjoy a high degree of autonomy as a special administrative
              region. (4) Peaceful negotiations. The country should be
              reunited by peaceful means, through contacts and negotiations.
              Since the Standing Committee of the National People's Congress'
              publication on New Year's Day, 1979 of the Appeal to Compatriots
              in Taiwan declaring the policy for the peaceful reunification of
              the motherland, the long-standing posture of confrontation and
              mutual isolation which had characterized relations between the
              two sides of the Taiwan Straits has changed, becoming more
              relaxed. Exchanges of friendly visits across the Taiwan Straits
              have been increasing year after year, including bilateral
              exchanges in the fields of science and technology, academics,
              literature, sports and journalism. Economic and trade
              cooperation has also maintained a momentum characterized by
              rapid development. Since 1992, the mainland's Association for
              Relations Across the Taiwan Straits and Taiwan's Foundation for
              Exchange Across the Taiwan Straits, both authorized by their
              respective governments, have engaged in routine contacts and
              discussions on questions arising from the relationship between
              the mainland and Taiwan. Working channels for non-governmental
              contacts have already been established. The "Wang (Daohan)-Gu
              (Zhenfu) talks" held in Singapore in April 1993 between the
              leaders of these two organizations signaled an historically
              important step forward in the development of relations across
              the straits; in 1994 heads of the two organizations, Tang Shubei
              and Jiao Renhe, held talks in Beijing and in Taibei, achieving
              results satisfactory to all Chinese on both sides of the Taiwan
              On January 30, 1995, General Secretary of the Central Committee
              of the Communist Party of China and President of China Jiang
              Zemin delivered an important speech entitled "Continuing to
              Strive Toward the Reunification of China". In his speech Jiang
              Zemin put forward eight propositions on the development of
              relations between the two sides of the Taiwan Straits and the
              peaceful reunification of China on the current stage:
                  Adhering to the principle of one China is the basis and
                  prerequisite for peaceful reunification. China's sovereignty
                  and territorial integrity must never be allowed to suffer
                  division. We must resolutely oppose any statement and action
                  for creating "the independence of Taiwan" and we must also
                  resolutely oppose the propositions to "split the country and
                  rule under separate regimes", "two Chinas over a certain
                  period of time" etc., which are contrary to the principle of
                  one China.
                  We do not have objections to the development of
                  nongovernmental economic and cultural ties between Taiwan
                  and other countries. According to the principle of one China
                  and the characters of international organizations concerned,
                  Taiwan has joined the Asian Development Bank, the
                  Asian-Pacific Economic Cooperation Forum and other
                  international economical organizations in the name of
                  "Chinese Taibei." However, we oppose Taiwan's activities in
                  "expanding its living space internationally" aimed at
                  creating "two Chinas" or "one China, one Taiwan." All
                  patriotic compatriots in Taiwan and other people of insight
                  understand that instead of solving problems, such activities
                  can only help the forces working for the "independence of
                  Taiwan," and undermine the process of peaceful
                  reunification. Only after peaceful reunification is
                  accomplished can our Taiwan compatriots and other Chinese
                  truly and fully share the international dignity and honor
                  attained by our great motherland.
                  It has been our consistent stand to hold negotiations with
                  Taiwan authorities on the peaceful reunification of the
                  motherland. Representatives of all political parties and
                  groups from both sides of the Taiwan Straits can be invited
                  to participate in the negotiations for peaceful
                  reunification. I said in my report at the 14th National
                  Congress of the Communist Party of China held in October
                  1992, "On the premise that there is only one China, we are
                  prepared to talk with the Taiwan authorities about any
                  matter, including the form that official negotiations should
                  take, a form that would be acceptable to both sides." "On
                  the premise that there is only one China, we are prepared to
                  talk with the Taiwan authorities about any matter," we mean,
                  naturally, that all matters of concern to the Taiwan
                  authorities are included. We have proposed time and again
                  that negotiations should be held on officially ending the
                  state of hostility between the two sides and accomplishing
                  peaceful reunification step by step. Here again I solemnly
                  propose that such negotiations be held. I suggest that, as a
                  first step, negotiations should be held and an agreement
                  reached on officially ending the state of hostility between
                  the two sides under the principle that there is only one
                  China. On this basis, the two sides may bear
                  responsibilities together, maintain China's sovereignty and
                  territorial integrity, as well as plan the future
                  development of the relations between the two sides separated
                  by the strait. As regards the name, place and form of these
                  political talks, a solution acceptable to both sides can
                  certainly be found so long as consultations on an equal
                  footing can be held at an early date.
                  We shall try our best to achieve the peaceful reunification
                  of China since Chinese should not fight Chinese. We do not
                  promise not to use force. If used, force will not be
                  directed against our compatriots in Taiwan, but against the
                  foreign forces who intervene in China's reunification and go
                  in for "the independence of Taiwan." We are fully confident
                  that our compatriots in Taiwan, Hong Kong and Macao and
                  those residing overseas would understand our principled
                  Challenged with world economic development in the 21st
                  century, we shall spare no effect to develop economic
                  exchange and cooperation between the two sides separated by
                  the Taiwan Straits so that both sides enjoy a flourishing
                  economy and the whole Chinese nation benefits. We maintain
                  that political disagreement should not impede economic
                  cooperation between the two sides of the Taiwan Straits. We
                  shall continue, for an extended period, to implement a
                  policy of encouraging Taiwanese investment on the mainland
                  and carry out the Law of the People's Republic of China on
                  Protecting Investments by Taiwan Compatriots. In any
                  circumstances, we shall protect all legitimate rights and
                  interests of Taiwanese investors in a down-to-earth way and
                  continually encourage exchange and contacts across the
                  Taiwan Straits which promote mutual understanding. Since the
                  direct links for postal, air and shipping services and trade
                  between the two sides are the objective requirements for
                  their economic development and contacts in various fields,
                  and since they are in the interests of the people on both
                  sides, it is absolutely necessary to adopt practical
                  measures to speed up the establishment of such direct links.
                  Efforts should be made to promote negotiations on certain
                  specific issues between the two sides. We are in favor of
                  conducting this kind of negotiations on the basis of
                  reciprocity and mutual benefit and signing non-governmental
                  agreements on the protection of the rights and interests of
                  industrialists and business people from Taiwan.
                  The splendid culture of 5,000 years created by the sons and
                  daughters of all ethnic groups of China has become ties
                  keeping the entire Chinese people close at heart and
                  constitutes an important basis for the peaceful
                  reunification of the motherland. People on both sides should
                  jointly inherit and carry forward the fine traditions of the
                  The 21 million Taiwan people, whether born there or in other
                  provinces, are Chinese and our own flesh and blood. The
                  lifestyles of our Taiwan compatriots and their desire to be
                  masters of their own country should be fully respected. All
                  their legitimate rights and interests must be protected. All
                  relevant departments in our Party and government, including
                  agencies stationed abroad, must improve their relations with
                  our Taiwan compatriots, listen to their views and requests,
                  show concern for and take care of their interests and do
                  everything they can to help solve their problems. We hope
                  that Taiwan Island enjoys social stability, economic growth
                  and affluence. We also hope that all political parties in
                  Taiwan will adopt a sensible, forward-looking and
                  constructive attitude and promote the expansion of relations
                  between the two sides. We welcome all political parties and
                  personages from different walks of life in Taiwan to
                  exchange opinions with us on the relations between the two
                  sides and on peaceful reunification. Their visits to the
                  mainland are also welcome. All personages from various
                  circles who have contributed to the reunification of China
                  will go down in history for their deeds.
                  We welcome leaders of Taiwan to visit the mainland in their
                  proper status. We also are ready to accept invitations to
                  visit Taiwan. We may discuss state affairs or exchange
                  opinions on certain issues first. Even a simple visit to the
                  side will be useful. The affairs of Chinese people should be
                  handled by us, something that does not take an international
                  occasion to accomplish. People on both sides of the Taiwan
                  Straits eagerly look forward to meeting each other and being
                  able to freely exchange visits. The above eight propositions
                  fully embody the consistency and continuance of the
                  Communist Party of China and the Chinese Government on the
                  issue of Taiwan; they embody their determination and
                  sincerity to develop the relations across the strait and
                  promote the reunification of the motherland. These
                  suggestions have been warmly welcomed by the Chinese people
                  at home and abroad and aroused great attention from the
                  international community. The historical course of reunifying
                  the motherland is irreversible, and the continuously
                  developing relations between the two sides of the Taiwan
                  Straits is in accordance with the general trend and the will
                  of the people. When the Chinese Government resumes the
                  exercise of sovereignty over Hong Kong and Macao on July 1,
                  1997 and December 20, 1999, respectively, the solution to
                  the Taiwan question and the historical mission of realizing
                  the reunification of China will emerge, for the Chinese
                  people, as an even more outstandingly important issue than
                  ever before. At that time the Chinese people on both sides
                  of the Taiwan Straits should unite in common efforts toward
                  the reunification of China.  

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