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the lease of the New Territories expires is already beginning

to cast its shadow before it. This shadow will, in the best

circumstances, grow increasingly large and the life of Hong

both Kong, economic and social, will become increasingly stunted.

unalwommis 47. Annex B sets out some of the effects amongst them some

which are already apparent of the approach of 1997.

48. As the effects of the approach of 1997 tec

become

more marked

Hong Kong may require assistance from the U. K. in a number of

possibly

ways, (There is not only the pessit.

There is not only the possibility that economic assistance

and the buttressing

might be required if industry and trade stagnates but we may have.

to buttress the civil service and take action to ensure that

communications are maintained at an appropriate, level. This will

Sharad god in nibertsin elogiat

give m

lelograme. require sympathetic recognition by Departments of HM.G.of these

needs as they develop.

49.

Further study of this factor will be required in consultation

with a wider circle in Hong Kong than can be associated with the

and this can probably est be preparation of this paper and is being put in hand in Hong Kong.

-Although, iven the limited circle within which, for security

reasons, the study must be confined, the outcome must represent

individual opinions and will not be a study in depth.

50. Another aspect of the approach of 1997 is the bearing

this has on the social policies which we pursue in the

meantime. Here we are faced with a dilemma. We must

administer the Colony in a manner which accords with our own

concepts of social justice, while we must at the same time

recognise that to do so will widen the gap between Hong Kong

and China and will make the transition to Chinese rule more

/difficult

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