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respond to our call. Only through a genuine international effort can we make a significant inroad into this aspect of the boat people

problem in 1989. In the course of this visit to Hong Kong, I shall also be announcing the donation by HMG of a further £1 million towards UNHCR'S operations in the camps here; a contribution of

125,000 US dollars in response to UNHCR's appeal for funds for the

repatriation programme; and a gift of £2,500 for English language

training equipment for refugees in the camps in Hong Kong to help

them to adopt more easily to life in the West once they have been

resettled.

5.

Another matter of great interest to me is the draft Basic Law.

I am reasonably encouraged by the improvements that have been achieved as a result of the pressure, both public and private, that

has been applied by many Hong Kong people and the British

Government. The Chinese appear to have gone a long way towards

meeting a number of important concerns. But I am far from complacent and we must see what the revised draft looks like before coming to any firm conclusions. In particular I want to hear what people have to say about the section on the future political

structure.

6.

We have

I am also encouraged by the progress we are making on the arrangements for the formation of the First SAR Government. in particular achieved agreement with the Chinese Government on arrangements for the continuity, of the legislature over 1997: this should be an enormous boost to confidence. I would like to pay

tribute to the Governor for the skillful way in which he has been handling these negotiations with the Chinese Government.

I am

7. One subject which I know is on your minds is the question of

defence lands and the PLA presence in Hong Kong after 1997. well aware of the sensitivities here. I have been following very closely the talks which have been taking place with the Chinese authorities on this. We must continue to press firmly and patiently for arrangement which make military and commercial sense and which are in the best interests of Hong Kong. I would like to hear your

thoughts on the way forward.

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