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iii. that the proposal be put to Wu Xueqian by Sir R

Evans in a personal message from the Secretary

of State on the lines of the annexed draft.

Sir E Youde and Sir R Evans have been consulted over these

recommendations and concur.

BACKGROUND AND ARGUMENT

Redacted under FOI Exemption S 27 (1)

History

4.

The Secretary of State will recall the awkward

period following Xu Jiatun's Press statement in November

1985 that the British неге not fulfilling their obligations

under the Joint Declaration.

The re were various

manifestations of Chinese anxiety about developments over

representative government,

It was

eventually agreed that the two sides should engage in an

informal dialogue, without pre-conceived ideas, on the need

to achieve convergence between any reforms to the structure

of Govenment in Hong Kong before 1997 and the structure of

the Government of the Hong Kong SAR after 1997.

5.

We have since had further exchanges with the Chinese

during visits by Ji Pengfei and Lu Ping to Hong Kong, and by Mr Renton and Sir W Harding to Peking. The Chinese

agreed that the subject need not figure on the agenda of

the third meeting of the Joint Liaison Group, no doubt out

of the concern to ensure that its first meeting in Hong

Kong should be free from contention. Some of the worst

Chinese suspicions may by now have been dispelled, but

there remains a need for a freer and more detailed exchange

of ideas if convergence is to be achieved.

6.

The next two years will be crucial. There are two related aspects of the problem, on each of which we have strong interest in dialogue with the Chinese:

a

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