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Civil Aviation ones, to be presented to the Chinese by about 14 February. The Constitutional Structures and Nationality papers were more complex and the Prime Minister and OD (K) would probably want look at them very closely. Action: Telegram to issue to Hong Kong about re-arranging the EXCO meeting.

THE LONGER TERM

4. The meeting discussed at some length the target we should try to reach by September 1984. There were 3 possibilities:

(a)

(b)

(c)

5.

a joint announcement, with a unilateral Chinese statement attached;

a Heads of Agreement dealing with the ground covered at that stage, not formally binding;

a formally binding international Agreement, subject to ratification and the completion of the necessary constitutional procedures.

It was agreed that a joint but not binding announcement would have the advantage of maintaining our formal position on conditionality for longer and would fit with EXCO's ideas. But it would probably be opposed by the Chinese and would create difficulties for HMG in lengthening time during which acceptability would be considered in Hong Kong.

6.

It

A Heads of Agreement would have a number of advantages. would provide a mechanism which would be more binding on the Chinese but which would allow for us to negotiate for a more detailed agreement later. Sir Ian Sinclair emphasised the advantages of such a procedure, which would take account of the genuine difficulties in reaching full agreement on the mass of detail still to be covered. On the other hand, Heads of Agreement would still pose problems of conditionality and acceptability and, unless they were very precise, would probably not be sufficiently binding on the Chinese.

7. A definitive binding agreement this year would require us to

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