SECRET

HKB 012/1

RECEIVED IN REGISTRY

24 JAN 1990

DESK OFFICER

47

032547

MDHIAN 3110

SECRET

FM PEKING

TO DESKBY 19080OZ FCO

TELNO 103

OF 19072OZ JANUARY 90

INDEX

REGISTRY

RA

Acurom Taken

fm

INFO DESKBY 190800Z HONG KONG, UKREP JLG HONG KONG

TOP COPY Q DIST ?

STRICTLY PERSONAL FOR MCLAREN, AUSS

HONG KONG STRICTLY PERSONAL FOR GOVERNOR

UKREP JLG HONG KONG STRICTLY PERSONAL FOR GALSWORTHY

YOUR TELNO 51: CONSTITUTIONAL DEVELOPMENT

1.

CHINESE REACTION WILL DEPEND ON THE SIZE OF THE GAP WHICH WE ARE UNABLE TO BRIDGE, BUT A FACTOR MAYBE THE WAY OUR MULTILATERAL ACTION IS PRESENTED PUBLICLY. SPECIFIC EXAMPLES OF AREAS IN WHICH THEY COULD DAMAGE OUR INTERESTS INCLUDE:

A)

POLITICAL STRUCTURE IN 1997: PUBLIC STATEMENTS ABOUT DISMANTLING ARRANGEMENTS IN THE POLITICAL STRUCTURE MADE BY US ON A PURELY UNILATERAL BASIS. THIS WOULD BE MATCHED BY COVERT PROPOGANDA BOTH IN PEKING AND IN HONG KONG ITSELF, TO THE EFFECT THAT ANYONE WHO SUPPORTED THE BRITISH VIEW OF CONSTITUTIONAL ADVANCE WOULD BE BLACKLISTED AND DEBARRED FROM POLITICAL AND ADMINISTRATIVE LIFE IN HONG KONG. IN EFFECT WE COULD SEE A CAMPAIGN TO ISOLATE AND HUMILIATE THE HONG KONG GOVERNMENT MACHINE BY ENCOURAGING NON-COOPERATION FOR THOSE WHO WOULD BE LIKELY TO REMAIN IN HONG KONG AFTER 1997:

.

B) THE NATIONALITY PACKAGE: PUBLIC CHINESE CRITICISM TO THE EFFECT THAT UNDER THE NATIONALITY LAW OF CHINA ALL HONG KONG CHINESE 'COMPATRIOTS'' WHETHER THEY HOPED TO HOLD UK PASSPORTS OR NOT, WERE CHINESE NATIONALS AND WOULD BE TREATED AS SUCH. IN ANY CASE, EITHER EXPLICITLY OR IMPLICITLY THEY COULD MAKE IT CLEAR THAT BRITISH PASSPORT HOLDERS WOULD BE EXCLUDED FROM POLITICAL AND ADMINISTRATIVE LIFE IN HONG KONG. THEY COULD ALSO USE EXISTING AND FUTURE COMMERCIAL LEVERAGE TO MAKE THE SAME POINT TO THE BUSINESS COMMUNITY. CONSEQUENCE: NATIONALITY PACKAGE WILL ACTUALLY POLICIES AND EMIGRATE TO THE UK AS SOON AS THEY CAN. SIMILAR SCRAMBLES FOR FOREIGN PASSPORTS. FURTHER PRESSURE FOR INWARD IMMIGRATION TO UK:

BENEFICIARIES OF THE

CASH IN' THEIR INSURANCE

T

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