CONFIDENTIAL
ANNEX C
SUPPLEMENTARY NOTES: FOR USE WITH BUSINESSMEN AND OTHER LEADING
FIGURES
1.
FUTURE OF HONG KONG
1.
Invaluable for me to hear people's views at first hand.
Important that Hong Kong people make their views known. What
are yours?
2.
PM's achievement in getting talks. Think of effect on
confidence if this had not been agreed. HMG committed to a settlement acceptable to Hong Kong people and Parliament. Meetings with Chinese have begun. We are optimistic but wrong
to rush. Do not mistake lack of bulletins for inaction.
Reshuffle. Relations with China excellent.
3.
MFA
Aware of main lines of Chinese thinking but they have not suggested there is a blue-print. We must get over to them that suggestion of a fait accompli will damage confidence.
Of course there are difficulties on sovereignty and on
future administration, but we want to argue Hong Kong's
interests in talks not in Press.
4.
Important point for us is that continuity should be effectively guaranteed. We are not convinced that Chinese guarantees are reliable.
Hong Kong people should think
carefully about this. What do you think?
Hong Kong Stock Market and Exchange Rate Fluctuations
4.
Sharp fluctuations in the Hang Seng Index more common
than in Western stock exchanges. In 1973 the Index fell from
1700 to little more than 200. In August of this year (before
the Prime Minister's visit) it fell from over 1300 to 937.
Several other factors, such as world recession, reduced growth forecasts, declining property prices and high international
CONFIDENTIAL
/interest