Background

1.

In July 1989 Singapore announced a relaxation of its

immigration rules to allow permanent residence status to be

extended to up to 25,000 blue collar workers (plus their

dependants) without their having to leave Hong Kong. On 9 January Lee Kuan Yew told the Governor that a group had been set up in Singapore to consider the possibility of extending the scheme for blue collar workers and introducing separate arrangements to provide passports for executives (who might have to spend 6 months on secondment in Singapore in order to qualify for a passport but

coult then return to Hong Kong for as long as they wished).

2. Since July 1989 there have been over 20,000 applications under

the scheme, 8,000 of which have been approved. But only 94 people

have left Hong Kong to go to live in Singapore. This is a useful

argument in support of our view that people in Hong Kong want an

"insurance policy" but do not want to leave Hong Kong.

Basic Law

3. The Basic Law was promulgated by the National People's Congress in Peking on 4 April. We have had detailed confidential discussions

with the Chinese authorities during the course of the drafting

process. As a result, a number of changes have been made to many provisions. The Law is still not perfect: thre are some provisions we would like to have changed (but the Chinese did not take up our

points) and we have made clear publicly that we should have

preferred a faster pace in the development of democracy. However,

our main concern is that the Basic Law should be consistent with the

Joint Declaration and, on the whole, it is an acceptable reflection

of it.

Bill of Rights

4.

The Chinese are unhappy about the Hong Kong Government drafting a Bill of Rights and publishing it for consultation without first

consulting them through the Joint Liaison Group. They are also suspicious about the concept, seeing is as a means

a means to justify

FAYANY (3)

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