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THIS IS A COPY

THE ORIGINAL HAS BEEN RETAINED IN THE DEPARTMENT UNDER

FM PEKING 105813Z MAY 79

TO IMMEDIATE FCO

SECTION 3 (4) OF THE that ovals. PUBLIC RECORDS ACT 1968

TELEGRAM NUMBER 423 OF 10 MAY 79

INFO IMMEDIATE HONG KONG

83

89

SAVED IN SEGR VAY NO. 51 17 MAY 1979

INDE

No

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See (3) (94)

HONG KONG TELS NOS 548 AND 549: FUTURE OF HONG KONG

1. WE TELEPHONED MINISTRY OF FOREIGN AFFAIRS ON 9 MAY

FOR THE TEXT OF SONG'S REMARKS. I FELT IT BETTER TO HAVE THIS

DEFORE GOING ANY FURTHER.

2. HOWEVER, I FOUND MYSELF SITTING BESIDE SONG AT A RECEPTION ON 9 MAY. HE TOLD ME HIS ACCOMPANYING GEN BIAO

ON HIS SCANDINAVIAN TOUR AND WILL BE AWAY FROM PEKING FOR

ABOUT A MONTH BEGINNING 12 MAY. I THEREFORE MENTIONED THE

AFP REPORT AND SAID WE WERE SEEKING THE ACTUAL TEXT FROM THE

FOREIGN MINISTRY. SONG SAID THERE WAS NO TEXT ( 1 ASSUME THIS TO MEAN HE SPOKE UNBRIEFED). HE HAD SIMPLY SAID THAT

THERE WAS PLENTY OF TIME LEFT TO SOLVE THE HONG KONG

QUESTION AND SECONDLY THAT INVESTORS NEED NOT WORRY.

3. I SAID THAT, AS THE GOVERNOR HAD EXPLAINED, WE FELT THAT TIME WAS SHORT IN THAT ONE PARTICULAR ADJUSTMENT

NEEDED TO BE MADE NOW IF CONFIDENCE WAS TO BE MAINTAINED.

SONG SAID THAT HE THOUGHT DENG HAD BEEN REASSURING ON THAT POINT.

4. I SAID I DID NOT WISH TO TAKE THE MATTER FURTHER AT THAT STAGE (THE OCCASION WAS NOT SUITABLE AND WE HAD NO INTERPRETER) BUT WE ON OUR SIDE WERE BEING CAREFUL TO

SAY AS LITTLE AS POSSIBLE ON THE SUBJECT OF HONG KONG.

IT WOULD BE EASY TO SAY SOMETHING DAMAGING TO CONFIDENCE.

SONG TOOK THIS POINT AND SEEMED A LITTLE SHAMEFACED. BUT

HE CLEARLY FELT THAT HIS REMARKS HAD BEEN HARMLESS. THIS

SUGGESTS NO ILLWILL BUT SOME CONFUSION ON THE CHINESE SIDE.

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