CONFIDENTIAL
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4. Some local papers have reported the auction story as a deliberate move by China to reassure people about 1997 and an indication that China will not take back Hong Kong then. Of course it isn't as clear cut as that. China Resources are almost certainly involved in the project primarily to make money. But in endeavouring so to do they will also be forcefully reminded of the close relationship between sales value and confidence.
(D C Wilson)
cc R JT McLaren Esq FED
T JB George Esq Peking
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