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LEADERS INIMICAL TO OUR AIMS WHICH WOULD THEN BE SET IN

CONCRETE. WE HAVE NO DETAILED POINTS TO RAISE WITH CHINESE

LEADERS AT THIS STAGE ABOUT THE IMPLEMENTATION OF THE AGREEMENT.

BUT ZHAO IS A PRACTICAL MAN, AND IT WOULD BE HELPFUL TO EXPLAIN

TO HIM IN GENERAL TERMS OUR THINKING ABOUT THE BASIC LAW AND THE

ADMINISTRATION OF HONG KONG UP TO 1997.

15. THE CALLS ON DENG XIAOPING AND HU YAOBANG WILL NECESSARILY

BE SHORTER AND FAR MORE DEPENDENT ON ATMOSPHERE THAN SUBSTANCE.

BUT THE MEETING WITH DENG WILL PROBABLY BE THE MOST IMPORTANT OF

THE WHOLE VISIT, PARTICULARLY IN THE HONG KONG CONTEXT. SEPARATE

BRIEFS ARE PROVIDED FOR EACH, DISTILLING THE GENERAL LINES OF THE

BRIEFING FOR THE FORMAL TALKS. THE CONVERSATION WITH DENG WILL

ONLY BE PARTLY ABOUT HONG KONG.

TO CREATE A CLIMATE OF TRUST.

DETAIL AND LATENT SUSPICIONS OF OUR INTENTIONS, OUR PRACTICAL

CONCERNS COULD BEST BE TOUCHED UPON MORE LIGHTLY: THE DEFENSIVE

LINE ON OUR ADMINISTRATION OF HONG KONG UP TO 1997 MAY WELL BE

NEEDED. THE MEETING WITH HU

THE OBJECTIVE, AS WITH ZHAO, IS

IN VIEW OF DENG'S IMPATIENCE WITH

HOWE

HONG KONG AGREEMENT

LIMITED

HD/HKD

HD/FED

HD/PLANNING STAFF

HD/PUSD

DEP HD/PUSD

RESEARCH DEPT (MR WALKER) PS

PS/MR LUCE

PS/PUS

SIR W HARD ING

MR WILSON

SIR J FREELAND

MR J CROWLEY, PUSD

COPIES TO:(VIA ADR)

MR ROBERTS, NEWS DEPT

MR FIFOOT, LEGAL ADVISERS

MR BURROWS, LEGAL ADVISERS

MR MARTIN, ASST STAFF CABINET

OFFICE

MR CARTLEDGE, CABINET OFFICE MR COLVIN, CABINET OFFICE

SIR P CRADOCK, NO 10 DOWNING ST SIR P CRADOCK, ROOM K195

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