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then according to the circumstances prevailing.
Any solution
would have as its prerequisites that Hong Kong was part of China
but the special status of Hong Kong would be respected. Even
when there was a political solution it would never affect
investments.
4. The Governor mentioned the lease issue. He said that the
long-term future was a matter for CPG and HMG. There was, however,
the immediate problem of individual leases in the New Territories
which could not wait. As the length of these leases shortened,
investment of the right type would be deterred.
5. Deng later reverted to the leases issue and asked the
Governor to tell investors to 'put their minds at ease'. The
Governor said that the problem could not be got over by general
assurances. His proposal was to replace a system of leases valid
until June 1997 by indeterminate leases which were valid as long
as the British administered the New Territories. Deng's reaction
was that any wording should avoid mention of British administration,
in view of the Chinese position. He could not confirm that the
political situation would remain unchanged but appeared to be
reassured by the Governor saying that his proposal did not affect
the Chinese position. He reaffirmed the Chinese position. He
said that, 'to put it more plainly', in this century and even at
the beginning of the next, Hong Kong would still be continuing its
capitalist system whilst China was getting ahead with its socialist
system. There were two possible solutions in 1997; to take over
Hong Kong or to recognise present realities. Neither solution
would affect investment. After the Governor had made clear that
his proposal did not affect the Chinese position and required only
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