SECRET
-2-
CHINESE ASSURANCES
4.
Appreciate Chinese assurances to intending investors in Hong
Kong. Do they apply equally to leaseholders in New Territories?
Would Chinese be prepared to say so publicly or confidentially to
intending investors? Clear however that confidence will not be
maintained for long by general assurances. Practical issues
require practical solutions, so sensible to act on leases before
slide in confidence starts.
LONGER TERM
5.
Recognise distinction between long-term future and immediate
concrete problems. Not too soon to begin thinking seriously about
long-term future. But emphasise not our intention to try and tackle
long-term through leases issue. Need for means of dealing with leases
that will not prejudice positions of either side on future.
REACTION TO CHINESE RESPONSES
6.
problem.
[If Chinese do no more than repeat previous assurances]: Must
keep in touch on problem. But cannot delay too long and will need
to discuss immediately if crisis of confidence appears imminent.
7. [IA response to acceptance of need to act now]: Detailed
Should be discussed by officials. Suggest they be asked
to recommend measures to maintain confidence of investors in Hong
Kong economy and to ensure continuing prosperity and stability of
the Territory. Measures should include question of individual land
leases. Must not conflict with the position of either side on status
of Hong Kong. This should hold confidence until 1989 or 1990.
Do Chinese wish to suggest other points to be covered?
SECRET
/PRESS
1
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}