CONFIDENTIAL
Hio 400/3
001761
MDHIAN 5654
ENTERS, 400/6
CONFIDENTIAL
FM PEKING
TO DESKBY 041OOOZ F C O
TELNO 1473
OF 040728Z AUGUST 89
INFO DESKBY 05010OZ HONG KONG
INFO PRIORITY WASHINGTON, BTC HONG KONG
HARASSMENT OF HONG KONG BUSINESSMEN IN SHANGHAI.
1. WE HAVE HEARD FROM SHANGHAI THAT TWO HONG KONG BUSINESSMEN, PETER CHIU PO-YEE (A BDTC) AND RINGO LEUNG FUK-WAH (A BN(0)) WHO WORK IN THE US-OWNED DOW CHEMICAL (CHINA) LTD'S SHANGHAI OFFICE HAVE BEEN QUESTIONED BY THE PSB IN CONNECTION WITH THE ACTIVITIES OF DOW EMPLOYEES DURING THE JUNE DISTURBANCES. THESE INCLUDED THE DISPLAY OF A BANNER OUTSIDE THE DOW OFFICE SUPPORTING THE DEMONSTRATORS, PHOTOCOPYING AND DISTRIBUTING COPIES OF HONG KONG NEWSPAPERS AND DONATING FOOD AND MONEY TO STUDENTS. CHIU AND LEUNG MAINTAIN THAT THIS ACTIVITY WAS A SPONTANEOUS REACTION BY LOCAL STAFF. LEUNG WAS INVOLVED ONLY TO THE EXTENT OF BUYING A LOUDSPEAKER FOR STUDENT LEADERS WHILE CHIU WAS OUT OF SHANGHAI FOR THE PERIOD OF THE DEMONSTRATIONS. NEVERTHELESS, IN PROLONGED INTERROGATION OF LOCAL STAFF MEMBERS, PSB OFFICIALS HAVE ATTEMPTED TO ESTABLISH THE EXTENT TO WHICH LEUNG AND CHIU ENCOURAGED AND ORGANISED THESE ACTIVITIES, EXPRESSING SCEPTICISM THAT THEY COULD HAVE OCCURRED WITHOUT THEIR ACTIVE INVOLVEMENT. LEUNG WAS SUBSEQUENTLY QUESTIONED FOR TWO HOURS ON 28 JULY AND CHIU WAS INTERROGATED ON 2 AND AGAIN ON 3 AUGUST.
2. LEUNG AND CHIU HAVE BEEN INSTRUCTED TO NOTIFY THE PSB WHENEVER THEY DECIDE TO LEAVE SHANGHAI. PSB OFFICIALS HAVE MADE CLEAR THAT THEY ARE INDIFFERENT TO THE NATURE OF THEIR TRAVEL DOCUMENTS. WE CANNOT RULE OUT THE POSSIBILITY OF ARRESTS IN THE NEAR FUTURE.
3. CONSUL-GENERAL SHANGHAI HAS INFORMED HIS CONSULAR COLLEAGUES OF WHAT HAS HAPPENED. ON INSTRUCTIONS FROM HIS CONSUL-GENERAL, THE US VICE-CONSUL (COMMERCIAL) HAS CALLED ON THE SHANGHAI FOREIGN AFFAIRS BUREAU TO IMPRESS ON THE CHINESE THAT THIS SORT OF BEHAVIOUR, WHICH IS ALREADY CAUSING DOW TO REVISE ITS PLANS FOR FURTHER INVESTMENT, CAN ONLY DAMAGE CHINA'S ECONOMIC AND COMMERCIAL INTERESTS.
4. THIS IS THE FIRST INSTANCE TO COME TO OUR ATTENTION OF HONG
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