HENRY Kissinger, the former United States Secretary of State, yesterday appeared to play down the impact of the Asia-Pacific Economic Co-operation (APEC) in transforming regional trade and political links. But Mr Kissinger, who was speaking at a conference organised by the Far Eastern Economic Review , said he was confident it would be in China's best interests to ensure Hong Kong's economic vitality after 1997. 'I do not happen to believe there is such a thing as the Pacific community,' he said. 'But I do believe that APEC is a very important forum in which leaders of the Pacific Rim and nations of the Pacific have an opportunity to exchange ideas and define common problems. 'But there are so many meetings that they have to attend this year that the law of diminishing returns is apt to set in and the bureaucrats take over. But up until now APEC has been very good.' Mr Kissinger also said that it was in China's own best interests to ensure that the 'one country, two systems' principle applied after 1997. 'I do not think that China is looking for an opportunity for confrontation. 'The Beijing Government will have every interest not to see the Hong Kong economy really diminish because so much of its trade depends on Hong Kong. 'If things devolve without major shocks, the foreign business will continue here unimpaired.' Despite recent turmoil over the Bill of Rights and growing concern about political clashes post-1997, Mr Kissinger remains optimistic about the territory's prospects. He is positive Beijing will pursue a 'practical, non-dogmatic' approach to the territory. 'When Beijing and Hong Kong start to deal with each other, practical decisions will come,' he said. But Mr Kissinger warned that direct political action by the US administration to influence Beijing's policy could be counter-productive. 'To what extent does the United States threaten to withdraw aid and exert other forms of pressure? I think it has always been counter-productive. Therefore I am dubious about it. 'Any legislation which exerts pressure will be counter-productive and will have the result of forcing confrontation. There may be issues, but it is not something Congress should involve itself with on a day-to-day basis. 'They (Congress) can express sympathy for Hong Kong but I do not think legislative acts will be helpful.' Later, Financial Secretary Donald Tsang said Hong Kong was playing a leading-by-example role in APEC. 'What we in Hong Kong bring to APEC is the proof that freedom and openness work, that the courage consistently not to interfere is rewarded by greater competitiveness and greater prosperity for the community as a whole,' he said. Mr Tsang will attend the meeting of APEC's economic leaders in Osaka later this month.