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(ii) Second, more detailed phase of talks began July. rounds since. Meeting 19/20 October useful and constructive. Next meeting 14/15 November. Governor of Hong Kong participating since July.
(iii) We aim to seek settlement acceptable to Britain, China and people of Hong Kong. Their views taken fully into account. In close consultation through Governor with Hong Kong's Executive Council (EXCO). Their role central. Governor and Unofficial members of EXCO visited London again 6-8 October.
(iv) Central issue: to devise package inspiring confidence. Given agreed common aim, confident this possible.
(v) Meanwhile important nothing said or done to damage confidence in Hong Kong or atmosphere of talks. Grateful your understanding.
(vi) Chinese propaganda floats Hong Kong as SAR of China, with considerable autonomy and lifestyle basically unchanged.
(vii) Most Hong Kong people sceptical of SAR idea. Evidence suggests details rudimentary and basis for confidence not grasped by Chinese. Investors need effective guarantees against Chinese interference. This at present provided by British administration.
(viii) We do not obtain revenue from Hong Kong nor have we colonialist aspirations. We want best possible deal for Hong Kong people.
BACKGROUND
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The Prime Minister is aware of the background.
'NOT FOR USE
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With the Prime Minister's agreement we keep the
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