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ANNEX
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Outline of Report
Description (Commonwealth Office: (c) with Treasury and Board of Trade)
(a) Brief statement of international agreement with China
under which Hong Kong is held.
(b) Population: 99 per cent Chinese of whom about half are
British subjects.
(c) Economy: artificial and "brittle": territory could become
a major liability in world trade recession or as the economy runs down towards the end of the lease in 1997. (d) Brief description of constitution.
The advantages and disadvantages of our position in Hong Kong
(a) Military: including intelligence (Defence; JIC) (b) Economic, trade; sterling balances; centre of communications; embarrassment from Hong Kong's exports of manufactures in
domestic market and in relation with other countries (Commonwealth Office, with Treasury and Board of Trade)
(c) Political (Commonwealth Office):
(i) "shop window"
(ii) Limitations of Hong Kong's constitutional
position and factors inhibiting any further
constitutional advance;
(iii) Vulnerability to Chinese pressure;
(iv) Reliance on local confidence.
What advantages do the Chinese derive from Hong Kong? (Commonwealth Office, with Foreign Office and Treasury)
(a) Contacts with the outside world.
(b) Foreign exchange earnings.
(c) Chinese use of Hong Kong's trade facilities.
(a) Hostage for our good behaviour.
(e) How far does China need a free Hong Kong?
(f) Is Hong Kong in any way disadvantageous to China?
Chinese Intentions towards Hong Kong (Foreign Office)
(a) Chinese attitude as set out in "official" pronouncements. (b) Extent to which this holds good in current situation in China
and Hong Kong. Can the "official" policy of adherence to the
status quo ever be restored?
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