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to maintain stability and prosperity in Hong Kong, not to

undermine it, and that we have no ulterior motives. Hope you will use your excellent contacts with Chinese authorities to reinforce that message.

- Aware that you have tabled a number of amendments and a

new clause for consideration in the third reading debate

tomorrow. Have to say that your amendments would be very damaging to confidence in Hong Kong. Would be seen there as kowtowing to Chinese.

- Nor are your amendments likely to encourage Chinese to be

more cooperative. They would effectively give Chinese a

right of veto over implementation of scheme.

-

Government are satisfied that Bill is entirely consistent with Joint Declaration and indeed it is expressly designed to give effect to our obligation to maintain and promote

stability and prosperity. Such a clause is therefore

neither necessary or justifiable.

Democracy

Had to respond to increased demand for greater democracy in Hong Kong. No question of this being contrary to Joint

Declaration.

Our decision for direct elections in 1991 and relevant

provisions in Basic Law demonstrate that we can achieve much of what we think is right for Hong Kong and work realistically with the Chinese.

- A tightrope to walk between the two. Would welcome your support in walking it successfully.

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