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Sewelly (brate

Privaly Secretary

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Permanent Under-Secretary

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Dogresulull

23/1

HONG KONG: LONG-TERM STUDY

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4/1

In March 1969 the Secretary of State circulated to his colleagues on the Hong Kong Committee a report (K(69)1) on the long-term future of Hong Kong prepared by a Committee of officials. This report has not yet been taken by the Committee.

2.

In the meantime we have given further thought in the F.C.0. to an aspect of the subject to which the official report perhaps paid too little attention namely, to the admittedly outside chance that a more co-operative Government in China in the years to come might make possible some sort of negotiation with them about Hong Kong's future. If this were the case it would at least mean that there was a chance of bringing H.M.G.'s connection

with Hong Kong to a conclusion which was not wholly unsatisfactory.

But our conclusion was that such a situation was hypothetical and subject to so many imponderables that there was little purpose in

attempting at this time a detailed assessment of the possibilities.

3. Because of the length and detail of the official report (K(69)1) it was decided to prepare a fresh covering paper for circulation to the Committee under the Secretary of State's name and for consideration at the same time as K(69)1, identifying the

issues on which Ministers would have to take decisions and taking

the opportunity to set out the further conclusions mentioned in paragraph 2 above.

4. A draft is attached for the Secretary of State's approval.

It has been agreed with Sir L. Monson and Sir S. Tomlinson and

approved by Lord Shepherd before his departure for the Pacific.

If the Secretary of State approves the paper it is hoped that arrangements can be made for taking it in Committee after the Secretary of State's return from his forthcoming visit to

Washington, by which time Lord Shepherd should also be back in

/London.

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