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changes of significance.

Position in Hong Kong

7.

Expressions of Chinese concern have caused considerable

dismay in Hong Kong, of a more lasting kind than the temporary

fall in

in the Hang Seng Index might suggest. They have revived

concern about China's intentions after 1997, about the extent

to which Hong Kong will be allowed autonomy after it becomes an

SAR, and about the extent to which the Hong Kong Government

will be able to administer Hong Kong free of interference until

then.

8.

to

Articulate objection to the Chinese

the Chinese position appears be limited to a comparatively small but vocal group of lawyers,

"pressure group" activists, and the English-speaking press.

The most extreme view is probably that expressed by Martin Lee

QC, a newly-elected member of

of LEGCO (and also member of the

Basic Law Drafting Committee), that the early introduction of

direct elections represents the only feasible bulwark against

excessive Chinese interference in Hong Kong affairs post-1997.

Mr Lee and a relatively small number of sympathisers apart

calls for direct elections from LEGCO members are fairly muted,

and may perhaps become more SO

in the face of evident Chinese

displeasure.

9.

,

Between

On the other side of the spectrum, most Hong Kong

business circles are opposed to the introduction of direct

elections and generally prefer the maintenance of the status

quo. They are certainly telling the

the Chinese

Chinese this.

these two positions, the bulk of the population are probably

fairly apathetic, but wish to avoid a row with China. That

said, there is little doubt that either an emasculation of the

1987 review, or signs that the Hong Kong Government we re not

seriously consulting local opinion on the vital issues it

raises, would be widely seen

as capitulation to Chinese

pressure. There would be widespread belief that the Hong Kong Government no longer had the capacity, or determination, to

continue to

administer

the

territory free of outside

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