SECRET

7.

This issue is the latest in a series of Hong Kong problems with financial implications for HMG. Such issues are likely to arise with increasing frequency as 1997

approaches. Mr Blatherwick has suggested that it might be

the Secretary of State might ask the Prime Minister to

circulate a minute to all Ministers warning that Hong Kong

is going to be a difficult problem for the next six years

and an expensive one at that; and that a special effort should be made for this, if only for this limited period, to

ensure that all goes well.

кого for

A R Paul

ROZAXD/3

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