THE blaze of publicity which has surrounded the expressions of anti-Japanese sentiment in Hong Kong during recent weeks has obscured the contribution that Japan has made and continues to make to the economic development of the territory. The passing of the 65th anniversary of the Japanese invasion of China rekindled memories of the atrocities also inflicted on the people of Hong Kong while Japan was an occupying force. The skirmishing over Tokyo's grip on the Diaoyu Islands heightened tensions and acted as a focal point for the street protests which took place last week. These wartime legacies should never be swept away and written out of history. However, an updated perspective is needed to accommodate the contributions which Japan in the post war years has made to the regeneration of Hong Kong as a vibrant commercial centre. Without Japan's vast investment in Hong Kong and support through expressions of confidence during the testing post-war years, the territory would have had considerably more difficulty achieving the levels of prosperity it displays today. It is timely to remember that Japan is the second biggest foreign investor in Hong Kong after China. According to official Japanese government figures issued last year, the country's direct investment in Hong Kong totalled US$13.8 billion. This accounts for 3 per cent of the country's total foreign investment and 18.2 per cent of its investment in Asia. Further, the 958 locally-based Japanese companies employed 78,191 people, making it by far the largest foreign employer in the territory. In addition to this direct investment, Japan has shown its credentials as a good corporate citizen by warning China on several occassions of the dangers of interfering with Hong Kong's current system after the handover next year. Such warnings are influenced by the chilly relations between Tokyo and Beijing but they should be welcomed at a time when the territory needs all the friends it can muster. The most recent of these warnings came from the Japanese Foreign Minister Yukihiko Ikeda at a meeting with the Chief Secretary Anson Chan Fang On-sang when he was reported to have stated his country's intention to pull out of Hong Kong if Beijing meddles in the territory's economic autonomy. This message was apparently also delivered to the Hong Kong and Macau Affairs Office director Lu Ping while the Chinese official was in Tokyo last June. In a letter to the Chinese government late last year the Hong Kong Chamber of Commerce voiced its concern about aspects of Hong Kong's future following the completion of a survey of Japanese business leaders resident in the territory. Key concerns were the maintenance of the rule of law, media freedom, changes to the taxation system and Hong Kong's ability to function as a centre for Asian trade and commerce. The findings of the survey were generally positive, however the chamber of commerce is to be congratulated for not ducking the issue and expressing the concerns of many Hong Kong residents which are often ignored by some local business leaders. Despite the country's war time record, Japan should be regarded as a strong economic ally of Hong Kong. This may assist the entry of calmer tone to a debate which will not go away.