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SO I PROPOSE THAT WE SHALL NOW TELL THE CHINESE THAT THE COMBINATION OF LEGAL AND ILLEGAL IMMIGRANTS (WITH THE ADDITIONAL BURDEN OF THOSE FROM VIETNAM) HAS CREATED A SITUATION WHICH WE CANNOT ALLOW TO CONTINUE. WE THEREFORE INTEND TO IMPOSE A

IN ORDER TO LESSEN THE UNILATERAL QUOTA ON LEGAL IMMIGRANTS, DISRUPTIVE AFFECT OF SUCH A BAN WE PROPOSE TO START WITH A QUOTA

OF 75 PER DAY FOR THE FIRST MONTH, DROPPING THIS TO 50 A DAY FOR THE NEXT AND SUCCEEDING MONTHS (THERE WOULD BE ROOM FOR AMENDING THESE FIGURES) IN ADDITION WE WOULD LIKE TO BRING IN A SYSTEM OF HONG KONG-ISSUED PERMITS FOR THOSE COMING HERE FOR PERMANENT RESIDENCE AND FOR THOSE COMING TO VISIT RELATIVES, IF A WATERTIGHT SYSTEM OF GUARANTEES CAN BE DEVISED FOR THE LATTER. THIS SYSTEM CAN ONLY BE WORKED EFFECTIVELY WHEN THE OVERALL

OUR HOPE IS PROBLEM OF LEGALS AND ILLEGALS IS UNDER CONTROL, THEREFORE TO PHASE IT IN DURING THE AUTUMN OR AS SOON AS THE

WE WOULD DO SO IN CO-OPERATION WITH OVERALL SITUATION PERMITS. THE CHINESE AND WOULD ENVISAGE ADJUSTING THE OVERALL QUOTAS AS THIS NEW SYSTEM IS BROUGHT IN,

10. THIS NOTICE WOULD HAVE TO BE GIVEN HERE AS WE HAVE BEEN IN

HOWEVER YOU SUCH CONSTANT TOUCH WITH NONA ABOUT THE PROBLEM, MAY CONSIDER IT DESIRABLE THAT SOMETHING SHOULD ALSO BE SAID IN

PEKING. AT THE SAME TIME WE WOULD HAVE TO EMPHASISE TO THE CHINESE THAT ILLEGAL IMMIGRATION IS GETTING OUT OF CONTROL, THAT WE ARE ALREADY EXERTING ENORMOUS EFFORTS ON OUR SIDE OF

WE COULD THE BORDER AND HOPE THE CHINESE WILL DO MORE ON THEIRS.

POINT OUT THAT THE PRESENT UNSATISFACTORY SITUATION EXISTS DESPITE WHAT WAS SAID BY HUANG HUA •TO DR OWEN IN OCTOBER LAST YEAR AND BY DENG TO MYSELF IN MARCH.

11.

IN PREVIOUS DISCUSSION ON IMPOSING A QUOTA WE HAVE ALWAYS CONSIDERED THAT IT WOULD BE NECESSARY TO GIVE THE CHINESE SOME WARNING. ! THINK THIS REMAINS TRUE, BUT THE OVERALL SITUATION HAS NOW BECOME SO SERIOUS THAT THE PERIOD OF WARNING WILL NEED TO BE KEPT TO A MINIMUM. THE TIMING I ENVISAGE IS THAT WE SHOULD SPEAK TO THE CHINESE ON 30 MAY (A FULL TWO MONTHS AFTER I OPOKE TO DENG) AND GIVE 14 JUNE AS THE DATE FOR IMPOSING THE NEW RESTRICTIONS. THIS WOULD JUST GIVE THEN TIME TO BRING NUMBERS ON THEIR SIDE UNDER CONTROL IF THEY HAVE THE WILL TO DO SO. IT WOULD ALSO JUST GIVE US TIME TO MAKE ADEQUATE PREPARATIONS

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WHICH

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