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(B) A YEAR'S DELAY

9.

IT WOULD THEORETICALLY BE POSSIBLE TO USE SIR E YOUDE'S DEATH AS A REASON FOR A SIGNIFICANT DELAY IN THE TIMING OF THE REVIEW, PERHAPS BY A FULL YEAR. IT WOULD THEN BE CONDUCTED IN 1988. LEGCO'S TERM WOULD BE EXTENDED FOR A YEAR AND THE ELECTIONS SCHEDULED FOR SEPTEMBER 1988 WOULD BE POSTPONED UNTIL SEPTEMBER 1989.

10.

THE POTENTIAL ADVANTAGES OF SUCH A DELAY WOULD BE SIGNIFICANT. THERE WOULD BE THE MAXIMUM CHANCE (BUT STILL NOT A 100 PERCENT CERTAINTY) THAT THE PROPOSED BASIC LAW PROVISIONS ON THE POLITICAL STRUCTURE OF THE HONG KONG SAR WOULD BE KNOWN BEFORE THE WHITE PAPER WAS PUBLISHED IN LATE 1988. THERE WOULD THUS BE THE MAXIMUM CHANCE OF ACHIEVING COMPATIBILITY AND AVOIDING CONFRONTATION. THE NEW GOVERNOR WOULD BE FIRMLY INSTALLED BEFORE THE REVIEW TOOK PLACE.

11.

SUCH A CAUSE WOULD HOWEVER MEET SERIOUS CRITICISM IN HONG KONG, AND ALMOST CERTAINLY ALSO IN PARLIAMENT. WE WOULD BE ACCUSED OF CAPITULATING TO PRESSURE FROM THE CHINESE AND DELAYING THE REVIEW BECAUSE OF THEIR KNOWN OBJECTIONS. IT IS THE VIEW OF THE ACTING GOVERNOR, IN THE LIGHT OF INFORMAL CONSULTATIONS WITH EXCO, THAT SUCH A DELAY WOULD NOT BE PUBLICLY ACCEPTABLE IN HONG KONG.

HE BELIEVES IT WOULD BE INTERPRETED AS A YIELDING TO CHINESE PRESSURE, AND THAT THE EFFECT ON CONFIDENCE WOULD BE SERIOUS. HE DOES NOT BELIEVE THAT EXCO OR LEGCO WOULD AGREE TO

IT.

(C) A LIMITED DELAY

12.

THE

THE ACTING GOVERNOR DOES HOWEVER SEE A LIMITED DEGREE OF FLEXIBILITY IN THE TIMETABLE WHICH WE HAVE SET OURSELVES. GREEN PAPER COULD BE PUBLISHED AS LATE AS THE END OF MAY CONSISTENT WITH OUR DECLARED TIMETABLE. IT IS POSSIBLE, DEPENDING ON THE IDENTITY OF THE NEW GOVERNOR AND THE TIMING OF HIS INSTALLATION, THAT ARGUMENTS COULD BE FOUND FOR DELAYING PUBLICATION UNTIL JUNE. THIS MIGHT BRING US ADVANTAGES IN TERMS OF GREATER FLEXIBILITY FOR CONTACT WITH THE CHINESE (SEE BELOW). 13.

BUT IT IS THE POTENTIAL FOR DELAY AT THE OTHER END OF THE

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