FDENTIAL
9. WU INSTANTLY REPLIED THAT THIS WOULD BE VERY DIFFICULT FOR
THE CHINESE. IT WOULD CARRY AN IMPLICATION OF CONTINUING SOVEREIGNTY OVER HONG KONG AFTER 1997. HE ASKED THE SECRETARY OF STATE TO RECONSIDER THIS. THE SECRETARY OF STATE RETURNED TO THE CHARGE, SAYING THAT THIS FORMULA HAD. BEEN CHOSEN AFTER VERY CONSIDERABLE
THOUGHT. WU THEN SAID THAT HE WANTED TO MAKE ABSOLUTELY CLEAR THAT
THE FORMULA WAS UNACCEPTABLE TO THE CHINESE GOVERNMENT AND THAT
THE BRITISH GOVERNMENT WOULD HAVE TO GIVE FURTHER THOUGHT TO
FINDING ANOTHER FORMULA.
CLAIMS
10. THE SECRETARY OF STATE REMINDED WU THAT WE HAD HANDED IN A
LOST OF CLAIMS SOME TIME AGO. THE CHINESE GOVERNMENT HAD SPOKEN
OF PREPARING COUNTER-CLAIMS BUT WE HAD HEARD NOTHING FROM THEM
SINCE. HE THOUGHT IT IMPORTANT THAT THIS QUESTION SHOULD BE
EXPEDITED. WU TOOK NOTE AND SAID THAT THIS SHOULD BE DISCUSSED
FURTHER THROUGH DIPLOMATIC CHANNELS.
AIR SERVICES
UA11. THE SECRETARY OF STATE SAID THAT THE JOINT DECLARATION
HAD CREATED GOOD CONDITIONS FOR CATHAY PACIFIC. BUT WE WOULD
WANT TO SEEK A GREATER ROLE FOR CATHAY PACIFIC ON
HONG KONG/CHINA ROUTES, AND A FURTHER EXTENSION OF THE PRESENT ARRANGEMENTS GOVERNING THE BRITISH AIRWAYS HONG KONG/ PEKING SERVICE. THESE QUESTIONS COULD ALSO SE PUSUED THROUGH DIPLOMATIC CHANNELS. WU AGAIN TOOK NOTICE AND AGREED THAT THIS
COULD BE PURSUED BETWEEN OFFICIALS.
CONSCRIPTION
12. THE SECRETARY OF STATE MENTIONS THIS AT LUNCH TO
WO WHO WAS NON-COMMITTAL. THIS EVENING WU TOOK THE INITIATIVE
TO HAVE A WORD PRIVATELY WITH THE SECRETARY OF STATE. HE SAID
THAT PEOPLE WERE WORRYING UNNECCESARILY OVER THIS PROBLEM.
WITH ONE BILLION PEOPLE CHINA COULD FIND PLENTLY OF RECRUITS.
THE SECRETARY OF STATE POINTED OUT THE GOOD EFFECT WHICH A PUBLIC STATEMENT OF REASSURANCE BY THE CHINESE GOVERNMENT
WOULD HAVE. WU TOOK NOTE AND SAID HE WOULD REFLECT ON IT.
EVANS.
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 HARDING
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
CONFIDENTIAL