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going on; it had given them a sense of confidence.
3.
The Governor continued by saying that, while in Hong Kong, Mr Liao must have seen a number of old friends. Did he have any advice to offer on the problems of Hong Kong? Mr Liao said that he understood what the Governor was saying. Population growth was a problem. After his return to China he hoped that the two sides would join in efforts to deal with the question of immigration. It was a headache to China as well. He was glad to hear of the good relations with NCNA. They too had their problems. He thought they should be given more power to resolve them. For instance, they needed more power to manage the question of people coming to Hong Kong from China. These people were sometimes harmful to relations between Hong Kong and China; if they caused trouble they should be sent back. He was glad to see that trade had improved between China and Hong Kong; but there were still problems on the Chinese side about its efficient management. He was in favour of greater economic co-operation between Hong Kong and Guangdong. If there were any obstacles, these should be removed. He himself lacked experience. He added, in English, "Give us time"
4. The Governor said that Vice Premier Deng had. emphasised the importance of cooperation in China's policy of modernisation. A number of projects had already started. They were on a small scale. This made sense since China still lacked a skilled labour force. The Foreign Minister had, however, said that he would like to see more sophisticated projects. The Governor had therefore sent Sir Y K Kan on a mission to Guangzhou. This had been useful. We were now studying the results. In addition, at a lower level, meetings were taking place on such things as cross-border problems and road communications. One had to realise that we were still in an experimental stage (Mr Liao agreed). He thought the most useful thing the Government could do at this stage was to show that they approved of the development of economic contracts with Guangdong. He thought that industry there, and in particular in Shenzhen, would develop fairly fast. The Government would do what it could to help.
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