6.

either the ceded territory of Hong Kong nor the NT lease.

However, they were fully alive to the significance of 1997

and it had been mentioned by them on various public occasions.

The LPS said that as far as HMG was concerned the future

of Hong Kong and the New Territories were inseparable.

3.

Mr. CHEUNG Yan-lung enquired what would happen

to Hong Kong's British social and cultural standards if

Hong Kong ceased to be British. The LPS said he did not

have a crystal ball and was not much of a prophet. The

present relations between China/Britain/Hong Kong were

very good, and this was probably a good time to press for

a favourable solution to Hong Kong's future. Mr. K.C. CHAN

said that he would like to make three points which he felt

were relevant to the present situation; firstly, China

must have some dignified means of retreating from the public

position it had taken in regard to the foreign occupation

of Chinese territory; secondly, China traditionally deferred

and deferred again the settlement of difficult problems;

and thirdly, the count-down of confidence locally might

have already started and any erosion of local confidence

night jeopardise negotiations between HMG, China and Hong

Kong. The LPS acknowledged these points, but believed

the message had finally got through to the Chinese.

were aware that not only must they not undermine local

confidence, but must positively bolster it.

*

They

/P.7

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