Registry No.

SECURITY CLASSIFICATION

Settet.

Guafidertizi.

Restricted.

Unadverźna d.

PRIVACY MARKING

In Confidence

DRAFT

BRIEF

To:-

RESTRICTED

HER oupl,

16 JU Type 1+

NO 7: HONG KONG

(Population: 4,600,000 [1978 esti-

mate])

From

Telephone No. Ext.

Department

147

DSR 11

PART I - GENERAL

SELF-DETERMINATION (ARTICLE I)

1.

The circumstances of Hong Kong are special as the

greater part of the territory is situated on land leased

from China. There is, therefore, no question of Hong Kong

ever becoming an independent state. Accordingly Article I

of the Covenant has not been extended to cover Hong Kong.

2. China does not recognise any of the treaties by which

Britain acquired Hong Kong since, in official parlance, they

were imposed on China at a time of weakness. Yet the

present Government of China is quite content to see Hong

Kong continue under British administration. They have very

sound economic reasons for this: over 30 percent of China's

foreign exchange is earned through Hong Kong, which in

general terms serves as a useful eye to the rest of the

world. During the recent visit to China by the Governor of

Hong Kong, Vice Premier Deng Xiaoping made a point of asking

the Governor to reassure Hong Kong businessmen about their

investments.

This is the clearest indication we have had

that China is prepared to see the present situation extend

beyond 1998 when the New Territories' lease expires. Their

attitude is that the problem of Hong Kong is a legacy of

history that will be settled when the time is right. In the

meantime they are content for us to continue administering

the territory as long as there is no question of any change

in its status:

Dd 0532000 800M 5/78 HMSO Bracknell

RRAYER CPP

dal Bracknell

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