From the Secretary of State

Foreign and Commonwealth Office

London SW1A 2AH

23 February 1990

Dear Robert.

Thank you for your letter of 8 January about the nationality

package for Hong Kong. You will by now have received a letter of

9 February from David Waddington and me.

You suggest that the stability and prosperity of Hong Kong are

likely to be undermined rather than sustained by our policy. The

fact is that the stability and prosperity of the territory are

already under severe threat because of the growing exodus of people

who are vital to Hong Kong's economy. This is not a steady

migration, but a trend which has increased sharply over the last few

years. It will undoubtedly continue unless we take steps to restore confidence among these key people.

It is true that the Chinese Government are committed to the

Joint Declaration for practical, political and economic reasons; China has a huge stake in the continuing success of Hong Kong. This is why we must do everything we can to help to maintain that

success.

I do not accept what you say about the motives of those in

Hong Kong who have led the passport campaign, nor that political

figures in Hong Kong have failed to grasp the realities of Hong Kong's situation. We have worked closely with the Executive Council

Robert Adley Esq MP

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