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no advantage in rushing matters. But he does not exclude the possibility of allowing the Hungarians to open a trade office in due course if it can be demonstrated that following the political changes in Hungary including changes in the composition of Hungarian overseas representation, the Chinese would have no legitimate cause for complaint on security grounds and if in the meantime the level of Hungary's two way trade with Hong Kong shows signs of developing through normal business visits.

6. During his visit to Budapest at the end of this month the Secretary of State might therefore take the line that

Hong Kong is keen to increase trade and investment links with Hungary. Hong Kong Government are willing to facilitate visits by Hungarian businessmen.

if Hungary's trade with Hong Kong does develop, it might be possible to consider some form of trade representation in due

course.

Rosalind Mand

RM Marsden

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