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(loosely identified as the experienced administrators round
Chou En-Lai and the senior Army Commanders) play an increasingly
influential part in policy making.
1. The gradual evolution of more stable and pragmatic policies
has been reflected in the Chinese attitude towards Hong Kong.
The violent phase of confrontation has been abandoned and the local
Hong Kong communists are under firm instructions from Peking to act
ithin the law and to direct their activities to building a broader
political base in the Colony. Communist financial institutions are
under instructions to expand Chinese commercial interests in the
Colony. While some local Communists are probably restive under
these restraints, by and large the Communist leadership in the
Colony appears to have accepted the current line.
5
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The long term prisoners still serving sentences for their
part in the disturbances in 1967 (115 in number at the end of
March) must remain a continuing point of friction in Sino-Hong Kong
There is little pressure for their release at the
relations.
moment and the local Communists secm resigned to the likelihood that
the prisoners will have to serve out their sentences less remission.
But for prestige reasons and the morale of their local supporters
the Chinese Government cannot afford to forget these prisoners.
and we must assume that it remains their objective to secure their
release.
Benefits of Hong Kong
6. The Chinese derive considerable benefits from the Colony, which
provides them with easy access to world markets and serves as
invaluable base for travel and intelligence activities.
With
the rapidly changing situation in South-East Asia, the value of the
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/ Colony