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BACKGROUND NOTE ON CONFIDENCE
IN THE HONG KONG ECONOMY
a)
Long-term Problem
ANNEX A
This consists of when and how the administration
The
of Hong Kong will be changed and in what ways.
solution adopted could have a profound effect on
investment and confidence in Hong Kong and thus
in Hong Kong's future role. Though concern about
the future already exists in Hong Kong it is not
yet an urgent problem, the assurances about
investment given by Deng Xiaoping have helped,
Hong Kong's prosperity remains high, and though it
is not too soon to think about a solution nothing
definite is necessary at present.
b) Short-term Problem
This consists of how to gain time for (a) by
avoiding situations that precipitate prematurely
a crisis of confidence about the long-term future
of Hong Kong. Examples are:-
(i) Individual leases in the New Territories
issued by the Hong Kong Government (all
of which expire in June 1997) become too
short to be economic, with resultant
slump in investment in real estate and
industry.
The critical date will be 1982
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/ since