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[ the
that an Order in Council on these lines would also be defensible
politically in this country. Ministers could say that its purpose was to deal with a practical problem which would become acute at some time during the next few years unless preventive action were taken. If asked whether the Order meant that British rule in Hong Kong would now continue into the twenty-first century, they could reply to the effect that it is difficult to predict what might happen so far ahead, but Hong Kong could look forward with confidence
to a stable and prosperous future.
7. There is, of course, no certainty that the Chinese would be prepared to go along with this solution; they may turn out to have quite different ideas. And even if their first reactions are positive it is likely to be many months before agreement is reached. It would nevertheless be helpful if the Secretary of State would now approve the idea of an Order in Council, and the text proposed, so that soundings can be taken during the Governor's visit.
Tactics
8. The Governor has given his views on how the leases question might be handled during his visit in Hong Kong telegram No 253.
He
envisages that a discussion which would begin by concentrating on the economic relationship between Hong Kong and China, especially
Regpiszonty Guangdong, would lead naturally to a mention of the leases problem,
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(02-/3)
and (perhaps after an interval for reflection) the proposed solution. Mr Cradock sees no reason why the whole hand should not be exposed during the Governor's visit, provided the initial reaction was positive (paragraph 5 of Peking telegram No 8 to Hong Kong). 9. In my view the key point is the one made by the Governor in paragraph 2 of Hong Kong telegram No 253, namely that our approach should be low key and that we should neither appear to be asking the Chinese for a favour, nor give the impression that we are tying to bounce them. That said, I recommend that the Government be given
The maximum discretion to play the hand as he thinks best. Secretary of State can then decide, in the light of the Governor's report on his discussions, what follow up action should be taken during his own visit to Peking.
10.
The approach which we have in mind is deliberately restricted
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