to the last quite illusory.
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People in Hong Kong understand this.
They want the present position to continue so far as possible under
a British umbrella but there is no reason to suppose that they regard
sovereignty in itself as the key point. A concession on sovereignty would therefore be a price worth paying for the removal of uncertainty and the maintenance of a form of British administration
for as long as possible beyond 1997. Thus with this option HMG
would stand a chance of obtaining a realistic arrangement for Hong Kong, which would assist our relations with the Chinese and
be a considerable foreign policy success. Without it we would
have little effective bargaining power.
14.
The departmental Legal Adviser considers that a relinquish- ment of sovereignty would require an Act of Parliament. An agreement
would also be necessary between the United Kingdom and China. While an important international issue of this kind would normally
be covered in a formal Treaty, it might be possible for the
United Kingdom to effect its renunciation of sovereignty and
continuing British administration by means of a simple endorsement by China which could be made public if necessary. Such a change would not prevent Hong Kong British Dependent Territories' Citizens
from retaining their nationality status or their children from
acquiring it. Nor would it invalidate international treaties or the continuance of Hong Kong's separate currency.
15.
The Secretary of State may wish to consider in discussion
with the Lord Privy Seal and senior officials how this might best
be put to the Prime Minister and to other members of the Cabinet.
The discussion could also cover planning for the Lord Privy Seal's
visit. It would be helpful in any case to get Mrs Thatcher's
agreement to a visit in September 1982 and to warn her of the problems which the future of Hong Kong might pose. In addition,
Lord Carrington might suggest putting the contingency paper to OD
under a covering note. The attached drafts cover these points.
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