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040/11

YED AGEST 7 93. 5

55951

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Sir E Yo

HONG KONG:

1.

REGISTRY

Action Taken

0 6 JUL 1981

SECRET

5617

RECENT DEVELOPMENTS

AB

There have been no major developments on Hong Kong in the last 4 weeks. The Governor is in the UK recovering from his hip operation (which seems to have gone well). He is at the King Edward VII Hospital, Midhurst.

2.

The Governor saw Mr Ridley and the Secretary of State last month and you have copies of the notes of these meetings. The present position on the major issues is summarised in these.

3.

The

On the Nationality Bill, UMELCO remain restrained. immediate concern is whether the Gibraltar lobby will succeed during the Committee stage in the House of Lords. They want Gibraltarians to have British citizenship with right of abode. The Committee stage starts on 7 July.

4.

The Hong Kong Government have been asked to give evidence to the Monopolies Commission on the Hongkong and Shanghai Bank bid for the Royal Bank of Scotland. Sir P Haddon-Cave is to appear before the Commission on 6 August.

5.

Other irritants in our relationship with Hong Kong continue to appear. The most recent was the failure to award any part of the MOD contract for 5 new vessels for Hong Kong to Hong Kong shipyards; the decision was based purely on costs but this is not believed by all.

6.

The paper on the future of Hong Kong has been reviewed in the light of the comments from Hong Kong and Peking. I am asking Mr Rushford to write to the Attorney-General's Chambers seeking his opinion on the paper and particularly on the changes that would have to be made to the 1898 Order in Council. When these have been received, I shall submit the draft paper.

2 July 1981

сс

Mr Donald

R D Clift

Hong Kong and General Department

SECRET

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