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encouraging Ash to find practically minded people to do his research and to involve people with practical experience from government business and the law. The Governor comments that Hong Kong academics do not have a particularly good record in this respect but that this is no reason not to seek to involve them.

Funding will be Dr Ash's major concern. The

Governor sees little prospect of direct funding from HKG. Given a sufficiently practical bias to the study and concentration on economic and legal questions, the CCI may be able to find commercial sources of help. The best sources would probably be in Hong Kong itself or in companies closely associated with Hong Kong. Some organisations that occur to us are the Hong Kong Association, and the Anglo-Hong Kong Trust. Among companies the obvious ones that come to mind are those with substantial interests in both Hong Kong and China eg Jardines, Swires, Cable and Wireless and Hong Kong Bank. Some of the major law firms with an interest in the area eg Baker McKenzie, Clifford Chance may also be interested given the legal aspects of the project (although this seems a somewhat longer shot).

One source of funds that is becoming increasingly attractive to academics working on China is Taiwan and I see that Dr Ash mentions the possibility of extending the scope of the study to Macao and Taiwan in his prospectus. But I do not think we would want to encourage this, given the obvious sensitivities as far as Taiwan is concerned and Dr Ash will no doubt be sensitive to the difficulties of obtaining funding from Taiwan and continuing to work with the Chinese authorities.

In

As to HMG funding, RAD's preliminary view is that they might be able to help but that they would prefer to offer assistance over specific research requests rather than contemplate a lump sum at this stage. They would certainly not wish to get involved in a longterm commitment to funding the CCI over a number of years. any event I think we need to know more about the details of his proposals especially over who is to do the research and what precise topics they are hoping to investigate before we could consider the possibility of HMG funding.

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D A Warren

Far Eastern Department

CC: Mr Paul, HKD

Mr Wye, RAD

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