More than one-third of China's exports come from foreign—mainly Asian—owned facto­ries. The big beneficiaries are Hong Kong and Taiwan. By integrating Chinese factories into produc­tion strategies, their companies can compete globally. Factory wages on the mainland—less than $ 1000 a year—are one 10th those in Taiwan. Companies from Hong Kong, a trading port of six mil­lion people, now employ more than three million workers in China. For Japanese businesses grap­pling with the strong yen, China is especially attractive. Japan's domestic market is sagging, and yen-based costs are pricing its exports too high. China offers a thriving market and a cheap produc­tion base. Nearly one of every 10 yen that Japanese companies invest this year will end up in China, by one estimate.