DSR 11C
successful implementation of which will depend upon at the
least tacit acquiescence on the part of the Chinese
Government.
Although the Chinese have stated that they
regard the whole of Hong Kong as Chinese territory
temporarily under British administration, including the
New Territories, which will revert to China "when the time
is ripe", they made clear to the Governor during his visit
to China in March that they were content for the present
arrangements to continue de facto for some appreciable time
to come.
I
They see Hong Kong as playing an indispensable part
in the Chinese Government's new modernisation programmes;
and they accept that it would be unable to make such a contribution unless Hong Kong's political, economic and
commercial system is maintained in its present form. The Chinese concern for the stability and prosperity of Hong Kong in this respect is thus very close to that of the
British Government.
3.
Nevertheless the Chinese are still obviously puzzled
and suspicious about what we intend to do. They may indicate their tacit acceptance in time for the Governor
to announce arrangements for the replacement of the present New Territory leases by leases of indeterminate durations when he addresses the Legislative Council in October this
year. If the Chinese do not by then indicate their acceptance of this arrangement any announcement would still have to be made as soon thereafter as could be arranged, and
still with Chinese concurrence: we cannot proceed without it.
We cannot rule out that a further protracted and very tactful effort may be needed to get the Chinese to accept our proposed arrangements for the New Territories.
Our
chances of making the arrangements stick would be made much more difficult if the Chinese concluded from promulgation of a new status for Hong Kong citizens that we intended other changes in Hong Kong's Long term future. Given the importance China attaches to Hong Kong's contribution to their
modernisation plans any deliberate act by HMG which
appeared to put the stability and prosperity of the
Territory at risk would in turn have far-reaching
effects on the UK's bilateral relations with the
Chinese People's Republic. For all these reasons we
/need
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