CONFIDENTIAL

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5.

The factories visited were quite impressive,

especially the float glass factory, and all had plenty of

space. There was however no sense of bustle and little traffic in the industrial estates, even in Shekou, where productivity is now reputed to be quite good. The contrast with the

atmosphere in Hong Kong seemed almost as sharp as ever.

6.

The superhighway site was not impressive. There was no sign of work in progress, no construction camp and no

bulldozers or other working vehicles to be seen. A stretch of

perhaps 2 km from Lok Ma Chau had been levelled. We were told

that no other sites had yet been worked on. All in all, it was

very hard to see how the target date of 1990 (for stage one

Shenzhen to Canton) could be met; but Chinese officials all

quoted this date.

7.

Chiwan port had a few small general cargo vessels in it. Not much was happening and there was no development work

to see. We were shown a Norwegian joint venture fertilizer

packaging plant.

8.

Shenzhen officials were not impressive. The Mayor had little to say. During the formal after-lunch talks, he handed

over immediately to the Vice-Mayor and left virtually all the

talking to him and other officials. The Vice-Mayor's briefing

on the development of Shenzhen was most unilluminating. He and

the other officials stuck to general statements about the value of co-operation, and gave no opinions as to how co-operation might develop.

9.

Details of the after-lunch talks and the Governor's

conversation with Yuan Geng on the hovercraft to Shekou are at

Annex.

CONFIDENTIAL

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