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3. These developments reflect the present very healthy state of relations between Britain and China. They should also be seen against a background of growing Chinese cooperativeness over matters concerning Hong Kong, and major investments by Peking-owned companies in property ventures and other long- term projects. The more recent developments are summarised in Hong Kong Tel No 1103. They underline China's very great interest in the continued stability and prosperity of Hong Kong.
ARGUMENT
4.
Following on Wang K'uang's call at Government House the Governor's acceptance of the National Day invitation would, as he recognises, amount to public acknowledgement of the position of the Director of NCNA as de facto Chinese Government repre- sentative in Hong Kong. The implications require careful con-
sideration.
5. In particular we need to consider whether this further recognition of the NCNA Director's special position would prejudice our long standing opposition to the appointment of an official Chinese representative in Hong Kong, or could raise Chinese expectations that we were prepared to change our position.
6. The Chinese interest in obtaining official representation in Hong Kong is of very long standing. The issue has been raised on various occasions since the Chinese Communists took power, most recently when the late Mr Crossland visited China in 1976
We have (see paragraph 40 of attached record of conversation). consistently refused to agree to the appointment of an official Chinese representative, largely because of the effects which this could have upon confidence in Hong Kong and the authority of the Governor. The arguments are set out in detail in the brief for Mr Crossland's visit. A less detailed brief was prepared for the visit which the Chinese Minister of Foreign Trade paid to Britain in November last year (in the event the matter was not raised). On that occasion the Secretary of State questioned our present position but agreed that it should be maintained once
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