CONFIDENTIAL

10

063733 MDHIAN 6066

TCP COPY Q DIST?

CONFIDENTIAL

FM HONG KONG

TO DESKBY 22113OZ FCO

TELNO 1958

OF 22101OZ JUNE 90

INFO IMMEDIATE UKREP JLG HONG KONG, BTC HONG KONG,

FOR HKD

PEKING

HKB 010/2

CELER

-Y

YRTELNO 1172: VISIT OF SIR Y K PAO

20 JUN 1990

1. SIR Y K PAO HAS RECENTLY BEEN IN PEKING FOR THE FINALER CELEBRATORY, MEETING OF THE BASIC LAW DRAFTING COMMITTEE WHILE THERE, HE HAD DINNER WITH DENG XIAOPING AS HE USUALLY DOES ON VISITS TO PEKING.

2. I GUESS SIR Y K WILL GIVE THE SECRETARY OF STATE AN ACCOUNT OF THE DINNER. HE HAS ONLY BEEN FLEETINGLY IN HONG KONG SINCE HIS PEKING TRIP SO I HAVE NOT DISCUSSED IT WITH HIM IN DETAIL. BUT I HAVE TALKED TO HIM ON THE TELEPHONE. DENG'S MAIN LINE ON HONG KONG SEEMS TO HAVE BEEN THE DANGER HERE AND ELSEWHERE OF POPULATION MOVEMENTS IF CHINA BREAKS DOWN IN CHAOS (SEE PARA 3 OF MY TELNO 1927). IN ADDITION DENG SPOKE ABOUT HIS VIEWS ON EASTERN EUROPE AND CHINA'S WISH NOT TO INTERVENE IN SOVIET AFFAIRS BY COMMENTING ON DEVELOPMENTS THERE.

3. SIR Y K PAO HAS NOW PASSED ON HIS BUSINESS INTERESTS TO HIS SONS-IN-LAW. HE IS UNLIKELY THEREFORE TO DEAL WITH THESE IN ANY DETAIL. HE MIGHT HOWEVER TOUCH ON THE QUESTION OF THE SECOND CABLE NETWORK. WHARF IS A MAJOR SHAREHOLDER. THEY ARE SQUABBLING WITH LI KA-SHING'S HUTCHISON GROUP (WHICH THEY JUST PIPPED TO THE POST FOR THE SECOND NETWORK) ABOUT THE LATTER'S PLANS TO INCREASE SATELLITE TELEVISION COVERAGE IN HONG KONG USING THEIR NEW ASIASAT PROJECT. BOTH SIDES ARE SEEKING PUBLIC/GOVERNMENT SUPPORT FOR THEIR RESPECTIVE POSITIONS OF PROTECTION AND FREE-FOR-ALL. SHOULD SIR Y K PAO RAISE THE ISSUE, I ADVISE THE SECRETARY OF STATE TO LISTEN AND SAY THE MATTER MUST BE ONE FOR THE HONG KONG GOVERNMENT TO DECIDE.

4. SIR Y K MIGHT TALK ABOUT THE SHANGHAI PUDONG PROJECT AND ENCOURAGE UK INVOLVEMENT. HE SAW ZHU RONGJI WHEN THE LATTER WAS HERE.

5. I KNOW OF NO PARTICULAR ISSUES WHICH SIR Y K MIGHT WISH TO RAISE

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