CONFIDENTIAL

CHINESE REACTIONS TO THE BRITISH NATIONALITY PACKAGE

1.

This paper considers the Chinese threat to take "corresponding measures" against the nationality package. It discusses the reasons

for the Chinese reactions to the package, and it concludes with a

section assessing the likely effectiveness of such measures, and

steps which the British and Hong Kong Governments could take to

counter Chinese actions.

Chinese Criticism of The Package

2.

A summary of public and private statements made by the Chinese on the nationality package is attached (Annex A). The main criticisms are that the package:-

(a) violates the Joint Declaration (JD) and agreed

arrangements on nationality, stipulated in the Memoranda

associated with the JD. (They have added on at least one

occasion that the Memoranda should be regarded as no less

binding than the JD itself);

(b)

(c)

(a)

goes against certain authoritative statements made by British Ministers and officials since 1985 (they have

cited statements by Lady Young in Spring 1985, by the

Governor to the FAC in June 1989 and by Lord Glenarthur to

the Lords on 28 June 1989: none of these fully carries the

meaning imputed by the Chinese);

- is divisive and detrimental to the prosperity and

stability of Hong Kong;

-

will present problems of allegiance and practical

difficulties concerning civil servants employed by the

future SAR Government;

(e)

will merely delay rather than prevent the departure of

numerous senior civil servants and other key members of

the Hong Kong community.

CONFIDENTIAL

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