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Mr Austin Um Schuel Str.
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TW M Smith Esq
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BRITISH EMBASSY LISBON
020/2
IN REGISTRY
02 FEB 1987
PA
15 January 1987
ARY
Merlagden
Dean Tom,
MACAU
There has been a brief spate of publicity about the negotiations over Macau during the last two weeks.
1.
2.
The controversy seems to have been generated by the right-wing Centre Democrat Party (CDS), which is traditionally sensitive to issues relating to the ex-colonies. Their leader, Adriano Moreira, raised in the Assembly of the Republic the question of the "secret" agreement with China said to have been signed in 1979. The Prime Minister promptly denied any knowledge of such an agreement, only to be contradicted by ex-President Eanes (now leader of his own party) who asserted that it should indeed be in the archives. Faced with this, the Government clearly decided that to come clean was the best way of avoiding prolonged controversy and, after a meeting of the Council of State on 6 January, published a statement containing extracts of the agreement. I enclose a translation. According to the press the agreement could not be published in full because it contained hard-line Chinese statements about the Soviet Union which might have caused embarassment now.
3. Calling the Council of State, which includes the Presidnet and the Communist leader Cunhal who has recently returned from a trip to China, has succeeded in giving an impression of some degree of unity on the issue. It has probably also depressed any expectations of a more sturdy negotiating strategy. Press comment is asserting that the Government has already accepted the Chinese demand that transfer of administration will occur in 1999 and that President Soares, until now one of the proponents of a longer time-scale, will also now accept this.
4.
There has been no other official comment beyond an MFA denial that China has threatened unilateral action to take back Macau if Portugal does not agree to 1999. Apart from the controversy
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