Hong Kong's trading ties with the United States could suffer because of its links with China, an economic expert said. Professor Fung Kwok-chiu, associate director of the Centre for Economic Research at the University of Hong Kong, said Washington might regard the territory as 'the centre of illegal trade activity'. He said Hong Kong had a sound, law-abiding record as a free trader and would remain an independent economic entity after the handover, but 'policy-makers in the United States may not think so'. The territory might be accused of conspiracy when illegal goods made in China were transported through the territory to other countries, he said. 'With the recent issues concerning the rule of origin of the textile industry and intellectual property rights, the US might take the belief that Hong Kong is intentionally or unintentionally helping China with its illegal trade. 'It is going to become a peril to us,' he said. Professor Fung was one of a score of international experts who spoke at the two-day Pacific Rim Economics Conference on Trade and Development at the Chinese University of Hong Kong and the Regal Riverside Hotel, Sha Tin, last week. The territory was also warned that it needed to stay at the forefront of transferring new technologies researched in laboratories into industry to maintain its leading position in southeast Asia and the world. Professor Charles Kao Kuen, former vice-chancellor of the Chinese University of Hong Kong, told the conference the territory would still be an important economic player. Professor Kao said: 'The role of post-1997 Hong Kong will not be that different, but even more important.' He said a proposed science park at Pak Shek Kok, Tai Po, would help the territory research new technologies. Hong Kong's continuing financial independence would allow it to extend its role as a global trader. He said the territory was well located and had excellent transport links to export to many nations. He said the science park would help China open up overseas markets. The conference, organised by the International Economics and Finance Society, heard the economic 'miracle' of some Asian countries had been helped by playing to their strengths. Professor Justin Lin Yifu , of the China Centre for Economic Research at Peking University, said most had started with labour-intensive industries because of their large work forces. 'Where their economy is labour-intensive, their industry is labour-intensive and when they accumulate more capital, they move on to capital-intensive industry,' Professor Lin said.