SECRET
-20-
DSR 11C
indefinitely. In May 1980, Gu Mu, then Vice Premier,
told the Hong Kong Financial Secretary that the Chinese
would provide the solution for Hong Kong. A future
Chinese administration might aim at a variation on the
them of a special zone for Hong Kong, within the Chinese
state but with a separate economic system and currency.
This might involve some British participation, in the
form of contract administrative or specialist personnel,
but eventually using a purely local administration of
Hong Kong Chinese with 'tributary' relationship to Peking.
In any case, there would have to be a transition period,
probably protracted in order to preserve confidence.
SECRET
/IMPLICATIONS FOR HMG
Dd 0532000 400 M 5/78 HMSO Bracknell
4