1995-96: REVIEW AND OUTLOOK : All Eyes Are on China, Taiwan and Hong Kong

For Andrew T. Sun, the cycle is complete: His grandparents lived in China. His parents were refugees in Hong Kong, where he was born. He received his higher education in the United States. With three elder brothers, he moved to Taiwan to make his fortune. Now Sun, 41, is in the capital of China, the ancestral homeland, launching a business.

“Personally, I feel happy to come back,” Sun said in an interview at his new 450-seat TGI Friday’s restaurant in northeast Beijing. “I feel like I’m giving something back to the homeland. It’s a ‘Roots’ thing. I guess Kunta Kinte [hero of the Alex Haley story] got to me.”

In business terms, Sun exemplifies what has been described as the rise of Greater China--the vast international business network formed by the diaspora of Chinese families overseas. And as 1996 unfolds in Asia, Greater China is at center stage.

At a time when the industrialized world has slowed to a crawl, this dynamic region of Asia--which unites the consumer market of China, the manufacturing expertise of Taiwan and the financial savvy of Hong Kong--rises above the crowd for anyone monitoring shifting economic and political fortunes in Asia.

Japan’s bureaucrats will spend this year trying to free their banks from a mountain of debt and kick-starting their sluggish economy. Nearby South Korea remains economically strong but politically paralyzed by scandals.

In Southeast Asia and India, governments are freeing up trade and liberalizing investment laws in an effort to compete for foreign money and markets.

But the region that will be followed most intensely is the Greater China triangle, whose fortunes are increasingly tied to the economic clout of the overseas Chinese, or huaqiao, numbering roughly 30 million people in 109 countries.

One commonly quoted estimate puts overseas Chinese investment capital at $2 trillion. Peter Drucker, the Claremont Graduate School management guru, estimates that overseas Chinese account for 80% of all foreign investment in China.

In the coming year, China’s continued growth will be tested on several key fronts:

* China’s growing trade surplus with the United States and most of the West--now second only to Japan’s--will continue to create tension as foreign companies demand reciprocity in terms of a more open Chinese market.

* Taiwan’s bold experiment with democracy will culminate with presidential elections in March, an unsettling event for the region and one whose outcome could threaten the expansion of economic ties between the two countries and chill the investing climate.

* In July, Hong Kong will enter its final nervous year as a British possession before being absorbed by the People’s Republic, setting off a scramble among investors seeking to adapt or escape.

In this period, people like Sun and his family--with interests in all of the affected territories--will be important links keeping the dream of Greater China alive.

In the overseas Chinese community, he said, there is a maxim: “America is a place where it is easy to eat but hard to strike it rich; Asia is a place where it is easy to strike it rich but hard to eat.”