Mr Hum

Mr

Mrs Pries

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Reference

1516

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Entwrpa expiroliz.

FUTURE OF HONG KONG: JAPANESE INTEREST

(657)

ник оче515

MKK040/5

RECEIVED.

A creda

1. Mr Tzunosaki of the Japanese Embassy called on 14 December to discuss talks and state of play.

2.

He came prepared to give you an account of what Hu Yao Bang had told Japanese leaders recently about Hong Kong, but it became clear that Mr Tzunosaki's account was the same as that given in confidence last week to Mr Donald by Mr Imanishi, Counsellor at the Japanese Embassy. (Mr Tzunosaki seemed

I

surprised but I pointed out that Mr Donald had overall responsibility for Hong Kong and we kept in close touch!) made it clear that we would be keeping Mr Imanishi's remarks very close as he had requested.

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3. I explained that at the last round there had for the first time been more detailed discussion and explanation by the Chinese of their plan. We had looked particularly at the legal, economic and financial areas. There was some common ground but there remained areas of considerable difficulty. What we

were trying to do, having made it clear to the Chinese that this was without prejudice to our position or the final outcome, was to see whether the Chinese plan could form the basis for a lasting solution. In order to find out we needed the Chinese to provide much more detail. We had provided and would provide further working papers on various areas in an attempt to draw them out.

4.

Mr Tzunosaki brought with him а number of press articles most of which were highly speculative. We also discussed the September 84 deadline, which I made clear was not helpful, and Chinese offort to reconsider the timing of a return of sovereignty.

threats

5. I said we were interested to read the speech made recently in Hong Kong by the new Japanese Consul-General there. He had made a number of helpful points about the need to concentrate on the talks and to reach a settlement that would maintain stability and prosperity. Mr Tzunosaki thought Japanese businessmen were continuing to invest in Hong Kong and knew of no lack of confidence among Japanese businessmen.

6.

I mentioned that we had seen a report about a meeting in October between Hu Yao Bang and the Japanese Socialist Leader Mr Ishibashi. Mr Tzunosaki knew of this meeting but said that no officials had been present and SO far as he knew there was no proper record. If he could find anything out he would let us know. [The newspaper report described Hu as providing a "surprising and very comprehensive statement of guarantee for Japanese investors in Hong Kong". Research Department are also pursuing.]

7.

Mr Tzunosaki was grateful for the briefing. I reminded

/him

CODE 18-77

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