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3.

6. For all these reasons, Ministers in both the present and the

previous Governments have agreed that it is essential to ensure that

there is no Chinese objection before going ahead. The Governor of

Hong Kong therefore outlined the proposed solution in general terms

to Deng Xiaoping and other Chinese leaders when he visited Feking in

March. Deng did not specifically endorse the idea but did not react

adversely. This was followed up in July when the British Ambassador

in Peking explained our proposals in more detail to the Chinese

Assistant Foreign Minister, and left with him a copy of his speaking

note. Similar action was taken by the Political Adviser in Hong Kong,

who spoke to the Director of the Hong Kong Office of the NCNA (the

unofficial representative of the Chinese Government in Hong Kong). We

also informed the Chinese Embassy in London of the action that had

been taken.

THE NEXT STEPS

7. The note left with the Chinese Assistant Foreign Minister

explained that the Governor hoped to announce the new proposals in

his speech at the opening of the new Hong Kong Legislative Council

session in early October. The Chinese indicated that they hoped to

let us have their comments sometime in August, but so far we have

heard nothing more from them. Even if the Chinese do let us know

soon that they have no objection. to our proceeding as proposed, it

may now be difficult to complete all the procedures that will be

necessary before the Legco opening. However, there is no reason why

the new measures must be announced at that time it was simply the

earliest convenient date for an announcement.

Certainly, it would

not be advisable for us to badger the Chinese for a reply, simply in

order to meet that deadline, lest they begin to suspect that the pro-

posals have some deeper significance that make them particularly

important to us.

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