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DSR 11C
to enter a dialogue without such a threatening incentive.
Actions to halt a slide in confidence of to respond to a
Chinese initiative
10. The following possible actions are graded in a rough
order of ascending difficulty for the Chinese. An important
feature of most of the proposals is that any action to extend
British administration would, to be credible, require amend-
ment or replacement of the 1898 Order in Council providing
for and defining the length of jurisdiction in the New
Territories (Annex B), almost certainly with Chinese
agreement or at least their readiness not to object to the
legislation if challenged. The Attorney-General shares
the opinion of our Departmental Legal Adviser that any
amendment would need explicitly to make clear the intention
of HMG to administer the New Territories beyond 1997.
number of the proposals also include the notion of a
relinquishment of sovereignty by HMG. We do not know that
the Chinese would in fact demand this but it is a logical
move for which we must be prepared.
A)
Reinforcement of existing assurances
The Chinese would talk at a high level to major local
investors in Hong Kong to encourage them to retain and
increase their investments. They would do the same
with selected foreign investors, banks, industrialists
and developers. They would reinforce assurances about
capitalism continuing in Hong Kong well into the next
century and imply that a change of status in 1997 was
unlikely.
(i) Likelihood.
Easiest option for Chinese.
as the assurances about no change become firmer.
(ii) Problems for HMG. None, except: -
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Harder
/(iii)