SECRET
7
DSR 11C
iii) The provision of a legal basis for a British
contribution to a new system of government for
example a 'special zone' within the Chinese State
but under local control.
iv)
Legal problems during a transition period.
v)
Legal problems of citizenship (see (a)).
CONCLUSIONS
13.
a) Movement by China on a long-term solution is not
at least
b)
likely during the next 5 years.
In the medium term we should aim at a satisfactory
arrangement on land leases in the New Territories.
We should not make concessions on sovereignty or a
Chinese representative without substantial under-
takings on China's part on the land lease issue.
We
should not agree to Chinese participation in the
administration of the Territory.
c) In the longer term we should not take any unilateral
d)
initiative to leave Hong Kong.
We should do every-
thing possible to preserve confidence there.
It is too early to forecast what form a long-term
Dd 0532000 400 M 5178 HMSO Bracknell
SECRET