Mr March

| NICK 4/1

CHINESE VIEWS ON HONG KONG AND MACAO

1. The attached minute from Mr Donald about a discussion between the Fortuguese Government representative in Macao and Ho Yin, who is com- monly regarded as Peking's representative in the colony, contains some interesting points. In particular lo is reported to have said that Feking's reason for tolerating the maintainence of the status quo in Hong Kong and Macao was "entirely unconnected with economics". The true reason was to utilise Hong Kong and Macao as "buffer zones" there- by to win more international friends for China.

2. We can, I think, take Ho Yin's denial of economic reasons for tole- rating the status quo with a pinch of salt. In Hong Kong's case this is patently false. I am not clear what Ho Yin means by "buffer zones" He is certainly not using the term in the accepted sense of the word. Hong Kong could only conceivably be a buffer zone if we had a large naval presence there acting as some sort of counter to the Soviet pre- sence in the Indian Ocean. But this is not of course the case. Ho Yin seems to be linking the buffer zone idea with Britain and Portu- gal's membership of NATO. What I suspect he is getting at is that China does not at present want to take any action which will rock the NATO boat given its anti-Soviet function. This would fit in with re- marks by another Chinese official recently to the effect that China was much too preoccupied with the situation on the Sino/Soviet border to think about recovering Taiwan and by extension Hong Kong and Macao.

K

18 October 1974

cc: ne Sheart HIRLOD

SECRET

JF R Martin

Far Eastern Department

1.

A

Mr Dinwiddy

PA

80 21/10 bo se

I agreed this line with 7. Martin

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2/10

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