-X· presumably the Governor
This was
Hong Kong or letting the status quo continue. an important development. If the Chinese accepted the validity of the treaties, which they did not because they were 'unequal', there was only one option in 1997: handing back. There were now two options;
it was important that both be left open. There had been some talk by people in Hong Kong of the status quo being extended now beyond 1997. That would rule out one of the options, leaving only the status quo. This was not reasonable. The Governor said that the comments by people in Hong Kong referred to by Mr Wang did not come from the Government. Mr Wang then agreed with the Governor that the Vice-Premier had been referring to events which he saw as happening in the fairly distant future. The Governor said that the leases represented a problem that would become important fairly soon. What he had said to Mr Deng about New Territories leases, and the proposal which had subsequently been amplified by HMG, had been designed explicitly to leave open both options to which Mr. Wang had referred.
4.
Any
Mr Wang replied that, although the assurances given by the Vice-Premier and elaborated by Premier Hua (who had pointed to the need for consultations before any changes took place) had been designed to put investors hearts at ease, he had the impression that people in Hong Kong had not put their hearts at ease. The question of the New Territories leases was complex. China did not recognise unequal treaties and for one to be handled differently from others would have wider implications change that was made would be looked at closely by the Soviet Union, Vietnam and Taiwan. The problem could be
Lui solved politically or legally as we had suggested.. such solutions involved further difficulties. It was also important to see the problem from the point of view of the masses (particularly in Guangdong) who might not understand these solutions. Neither he himself, nor the Governor, could estimate what their reaction would be. He did not think either solution practicable at present. There was however a different approach: economic co-operation. In this respect he welcomed the comments which the Governor had made on the need for greater investment from Hong Kong in China. This would have a considerable impact. As people realised that it was safe to invest in China and that growing co-operation improved prosperity on both sides, the problem of assurances might become less important.
5.
The Governor asked whether 'investment' included 'real estate'. Mr Wang said it included both, and both
He* in the New Territories and on Hong Kong Island. wondered if the Vice Premier's assurance about investment might in some way be used to satisfy people in Hong Kong about their leases. However that might be, it remained undoubtedly true that businessmen thinking of investing in Hong Kong asked questions about how safe their investments would be for the future. He had that morning been closely
/contd...
2.