CONFIDENTIAL

CONFIDENTIAL

FM UKREP BRUSSELS

TO IMMEDIATE FCO TELNO 2465

OF 26080OZ JULY 89

INFO IMMEDIATE HONG KONG

Hko 09111

156551 MDHIAN 4769

TOP COPY Q DIST ?

INFO ROUTINE WASHINGTON, PEKING, OTTAWA, CANBERRA, TOKYO

PERSONAL FOR PAUL, HONG KONG DEPARTMENT

HONG KONG FOR GOVERNOR

GOVERNOR

HONG KONG TELNO 2491: INTERNATIONAL ASPECTS OF CONFIDENCE BOOSTING MEASURES FOR HONG KONG

1. IN HIS TUR SIR D WILSON REFERRED AMONG OTHR POSSIBLE MEASURES

TO THE OPENING OF A COMMISSION OFFICE IN HONG KONG AS SOON AS POSSIBLE. THE PRESENT SITUATION IS THAT THE COMMISSION DO NOT/NOT ENVISAGE OPENING ONE THERE NEXT YEAR: THEY HAVE ALREADY PUT IN THEIR 1990 BUDGET BID FOR NEW OFFICES, WHICH DOES NOT INCLUDE HONG KONG

(THIS BID MAY WELL BE SCALED DOWN IN THE BUDGET PROCEDURE).

2. OUR CONTACTS WITH DG I AND THE ANDRIESSEN CABINET INDICATE THAT THEY DO, HOWEVER, INTEND TO SET UP AN OFFICE (NEITHER A FULL-BLOWN DELEGAITION IN ITS OWN RIGHT, NOR AN OFFSHOOT OF THE PEKING DELEGATION) IN 1991. WE HAVE URGED THE COMMISSION TO GIVE A HIGHER PRIORITY TO HONG KONG, NOT LEAST BECAUSE OF RECENT EVENTS IN CHINA, AND WE SHALL CONTINUE TO DO SO. IT WILL BE HARD TO ACCELERATE THE CURRENT COMMISSION TIMETABLE, AND IT PROBABLY MAKES MORE SENSE TO FOCUS ON PREVENTING THE 1991 DATE SLIPPING AND ON GETTING AN EARLY PUBLIC STATEMENT OF THEIR INTENTION TO OPEN AN OFFICE THERE, THE LATTER HAVING, I WOULD ASSUME, A USEFUL CONFIDENCE BUILDING DIMENSION.

3. MORE GENERALLY, THE COMMISSION (AFTER A FEW DOUBTS IN THE IMMEDIATE AFTERMATH OF THE CHINESE REPRESSION) APPEAR NOW TO BE RECEPTIVE TO THE ARGUMENT THAT THE COMMUNITY AS SUCH HAS AN IMPORTANT INTEREST IN HELPING TO PRESERVE THE PROSPERITY AND STABILITY OF HONG KONG, AND IN ENCOURAGING THE CONTINUED DEVELOPMENT OF ONE OF ITS MOST IMPORTANT TRADING PARTNERS. ANDRIESSEN'S PLANNED

VISIT TO HONG KONG IN THE AUTUMN (OCTOBER/NOVEMBER) SHOULD PROVIDE A GOOD OPPORTUNITY TO PUT ACROSS BOTH OUR WIDER MESSAGE ABOUT HONG KONG'S VALUE TO THE EC, AND THE SPECIFIC NEED FOR AN OFFICE THERE AS

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