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the deficit on the Government's over-reliance on deriving revenue from high land prices. In two separate commentaries, the paper said the tax rises would harm the economy as a whole. The FS had failed to come up with proposals to curb wastage in Government expenditure and to help industry. The New Evening Post said editorially that after years of rapid expansion in the public sector it was time to exercise constraints and austerity, particularly when the Director of Audit pointed out time and again that there was so much wastage in the Government. The FS should not increase tax when HK was undergoing recession. It described as short-sighted the FS's refusal to exempt interest tax on HK dollar deposits.
5.
MARSHAL YE RESIGNS:
It was confirmed during the week that 85-year-old Marshal Ye Jianying would resign as chairman of the National People's Congress. He was apparently to be succeeded temporarily by NPC Vice-chairman, Mr. Peng Zhen. A few independent papers related this change in the Chinese leadership to HK's future. The Financial Daily quoted unnamed political analysts saying the resignation indicated that pragmatists headed by Mr. Deng Xiaoping had got on top of the leftists. The pragmatists were more flexible on the 1997 issue and this would have a positive effect on the diplomatic talks. A CU lecturer said Marshal Ye's stepping down would reduce the threat that the NPC might vote to turn HK into an SAR before 1997. A researcher of HKU's Centre of Asian Studies also agreed that the retirement of Marshal Ye was good news for HK because he and Mr. Liao Chengzhi took a hardline on the sovereignty question. However, the editor of Seventies Monthly, Mr. Li Yi, disagreed and said the senile leader was seldom involved in the formulation of policies. Sing Tao Jih Pao said editorially that it was Mr. Deng Xiaoping and not Marshal Ye who masterminded the reversion of sovereignty over HK.
6.
RIGHT-WING PRESS LINE:
The Budget, the Governor's visit and the Government's decision not to go ahead with the Chek Lap Kok airport plan dominated leaders in both independent and right-wing papers. While commenting on the Budget, three papers also made reference to HK's future. The HK Times blamed the economic setback on the uncertain future of HK and China's sovereignty claim over HK. The HK Daily News and the Express considered the issue and the Sino-British talks had an important bearing on any economic upturn in the territory. A Kung Sheung Daily News reader wrote to the paper urging people and associations who wished to maintain the status quo to pledge support to the Government as some 300 civic bodies had done during the 1967 disturbances by means of a press advertisement. It called on them to register with the paper within three days if they wished to retain the status quo. In turn these expressions should be registered with the UN.
7.
THE ENGLISH-LANGUAGE PRESS:
The English-language newspapers, including the Asian Wall Street Journal and the International Herald-Tribune, carried various items related to the future. There was coverage of the Budget and the decision not to go ahead for the time being with the replacement airport; there was also coverage of the China Bank announcement that it would lend money to help small industries and of a seminar at which it was announced that the HK Bank had
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