CONFIDENTIAL
4. MIT IS THIKS KIND OF FEELING WHICH LIES BEHIND THE RECENT REVIEW OF ''HONG KONG '86'' WITH ITS VENWAND FRONG PAGE TITLE ''JITTERY CINTY' IN THE FAR EASTERN ECONOMIC REVIEW (''FINE HOPES FADE TO FEARS''): AND BEHIND THE INTERPRETATION IN THE FINANCIAL PRESS OF HINCREASING SOFTNESS IN THE MMDDLE LEVEL RESIDENTIMAL PROPERTY MARKET AS ''DEFINITE SIGNS THAT THOSE PEOPLE WHOSE BELIEF IN HONG KONG'S FUTURE IS INTEGRAL TO HTS FUTURE WELL-BEING ARE STARTING TO HAVE
SECOND THOUGHTS''
5. HN ALL THE HONG KONG GOVERNMENT SAYS AND DOES WE SEEK TO COUNTER THESE TRENDS. BUT EXPECT THIS SUBDUED AIR OF PESSIMISM TO PERSIST AT LEAST UNTIL SOME EVENT PRODUCES A NEW FILLIP. THERE IS NONE N SMIGHT AT THE MOMENT AND THIS MAKES IT DOUBLY IMPORTANT THAT THERE SHOULD BE NO NEW NEGATIVE FACTOR INDUCED EITHER BY ANY CHINESE ACTION, OR BY THE FOURTH MEETING OF THE JOHNT LAMISON GROUP KAN JULY. WHAT WE REALLY NEED IS SOME POSITIVE ACHIEVEMENT AT THAT GROUP
MEETING.
YOUDE
LIMITED
HKD
FED
ERD
PROTOCOLD.
PS
PS/MR RENTON
PS PUS
SIR W. HARDING
MR WILSON
(REPEATED AS REQUESTED)
~2- CONFIDENTIAL