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to appreciate and understand the role of the British Parlia-
ment in Hong Kong's affairs,
The attitude of such people,
in brief, seems to be that as Hong Kong is not dependent on
Britain for financial support the local government should not
accept Ministerial direction from Britain. They resent
Parliamentary pressures, particularly in regard to labour
reforms, which they attribute to protectionist desires to
safeguard U.K. interests. While this point of view is
understandable it can be carried too far. HMG is responsible
in Parliament and internationally for what goes on in
Hong Kong, and to accept that responsibility without inter-
vening where necessary would be to accept an inverted Macao
type situation. Nevertheless this local attitude must be
recognised. The stark fact is that, for a number of years now,
Hong Kong has been regarded by Britain as a competitor rather
than a Colony (and it must be admitted that the feeling of some
of our Ministerial colleagues towards Hong Kong has to some
extent contributed to the local attitude) and for this reason
Britain's motives, especially in regard to labour and social
reforms, tend to be suspect.
Policy
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6. Whilst this is not a paper in which I should attempt
to explore in depth what our policy in Hong Kong should be
I feel it may be helpful if the long and short term aims
were to be touched upon bearing in mind the obvious, viz
that the development of elected representative government
in Hong Kong would be unacceptable to China.
7.
If it is accepted that Hong Kong will one day return
to China then it seems that the only feasible long-term
aim of policy must be to prepare for the hand-over in such
a way that it can be conducted in an atmosphere of goodwill
with the minimum of disadvantage and disruption for the
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/people