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(Russia
particularly those disputing ceded areas with us. would, however, be reluctant no doubt to accept the proposition that treaties with China involving the transfer of territory are all "unequal"). The ceded areas of Hong Kong could not be viable separated from the main industrial
areas in the New Territories; the frontier in Kowloon would
be impossible to control; all the sea and air approaches could be claimed as under de jure Chinese control as well as
being under their de facto control. Continued retention of
these areas would make no sense, either economically or politically.
Timing of an Initiative
80. The timing of any initiative on our part with a view to withdrawal would clearly need careful judgment. A number
of the factors to be taken into account have already been
mentioned - - notably, China's interest in reaching a solution and the possibility of handing Hong Kong over with its trade outlets to the Western world unimpaired (in itself greatly dependent on American willingness to co-operate). present climate is not favourable in any of these important respects. We can now only indicate the broad limits of time which, in our opinion, may be available to us to make
such an offer.
The
nor at
81. Genuine negotiations could not be mounted in present
conditions in China, nor in the foreseeable future; the present time would it be possible to reach any kind of tacit understanding. If we sought now to hand the Colony back we could not do so with any hope of discharging our responsibilities towards its people or of getting any of them
out;
and there could be serious damage to relations with our allies. The other end of the time scale is determined
by the strong probability that public confidence in the Colony's future will start to slip and the economy to rundown in the 1980s; it could become a serious liability
to us and lose its value to China. All this points to an initiative on our part taken not later than the early 1980s or as soon as there emerges in China a regime with which we might be able to do business and which all our allies would
be prepared to countenance avoiding, however, and time
when:
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