SECRET
BACKGROUND
1.
Lord Shawcross has visited China on several occasions, both privately and on behalf of Morgan Guaranty for which he is a special adviser. The Chinese pay him special attention. He has been received in China at a high level and is in close touch with the Chinese Embassy. Secret sources indicate that Lord Shawcross has
discussed Hong Kong's future with the Chinese Ambassador, The Secretary of State will therefore wish to take a cautious line.
2.
Lord Shawcross has a keen interest in Hong Kong, where the Morgan Bank is active. Following a visit there last autumn (during which he took a line generally helpful to HMG) Lord Shawcross asked Mr Pym for an assessment of the Hong Kong situation on 17 December
1982.
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3.
Lord Shawcross was subsequently briefed on Hong Kong by Mr Giffard on 28 April 1983 before visiting China in May as the guest of the Chinese People's Institute of Foreign Affairs. During that visit Lord Shawcross met Assistant Foreign Minister Zhou Nan, who spoke about Hong Kong's future, and to whom Lord Shawcross pointed up the importance of maintaining confidence in Hong Kong.
4.
Lord Shawcross called on Mr Luce on 7 September. He floated the idea of 'internationalising' Hong Kong's Executive Council within the context of Chinese proposals for an autonomous Hong Kong. Lord Shawcross aired this concept again in his letter to 'The Times' of 23 September. The letter otherwise took a generally helpful line about the basis for confidence in Hong Kong and the need to seek an agreed settlement on the Territory's future.
Hong Kong Department 30 September 1983
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