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Government might be prepared to meet all or part of the costs if they were convinced that it would be in Hong Kong's interest to establish such a transmitter.

When we meet I would like to tell you what the Governor and the Chief Secretary-Designate said to me about this.

Identifying Hong Kong's own interests involves looking at the tripartite relationship of China, Hong Kong and the United Kingdom. I have no intention of teaching my grandmother how to suck eggs by embarking on a geo- political dissertation on this, but it might help you to understand why I think it will be fruitful to press forward on this front if I set out, briefly and simplis- tically, my reading of the position.

China will be for the rest of this century and after- wards of ever increasing importance in the world political scene. It is vital to maintain the friendly relationship of the West and of Britain with her, both for its own sake and as a counter-balance to the aggres- sive policies of the Soviet Union. Hong Kong is the fulcrum on which the West's relationship with China turns, not only as the chief point of contact for Sino- Free World trade, but as the key to developing political understanding and relationships. New methods of trading co-partnerships are emerging from Hong Kong's contacts with Peking which may well set patterns for the future. The Chinese themselves are becoming increasingly dominant in Hong Kong, with mainland China becoming more and more involved in Hong Kong's business sector through the Bank of China. Peking recognises the unique contribution which Hong Kong is making to the world with its vitality and vigour, which is the result of a peculiarly success- ful mix between Chinese entrepreneurial skill and British stability. China, however, would obviously not want Hong Kong to become self governing, but so long as no moves are made in this direction it would seem that the expiry of the lease is of little relevance to the Peking Chinese, who in any case do not recognise its existence. It seems mainly to be of significance to companies coming under British law, who face problems over the legal period for which they can hold property.

If Hong Kong is as vital to our relationship with China as I believe it to be, then anything which can be done to improve Hong Kong's own relationship with China must be of value. If it is accepted that the Peking Chinese themselves view the BBC's External Services as increasing understanding and improving the relationship of Hong Kong with China, then it must be to Hong Kong's own advantage to increase the audibility of our services to China and hence to welcome the establishment of a relay station as soon as possible. If they were prepared to give practical recognition to this by paying for the station, we could have it in operation something like two years after a

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