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ANNEX A TO
D Cts Staff(R)76/259/22/2
THE THREAT TO HONG KONG'S INTERNAL STABILITY
1.
The principal threat to Hong Kong's internal stability during the run-up to 1997 is a collapse in political and economic confidence. This could set in motion a series of mutually reinforcing trends which
may lead to outbreaks of violence and seriously threaten the
Territory's stability. A number of factors could cause this to
happen.
Chinese Policy towards Hong Kong
2.
Chinese statements and conduct indicate that their objectives
towards Hong Kong are, in order of priority, to recover sovereignty,
and to maintain stability and the economic gains China derives from
Hong Kong's prosperity. In line with these aims, China works to
achieve a smooth handover through discussions and negotiations within
the JLG; increase Beijing's influence over the decision-making process
in Hong Kong; ensure all awkward issues (eg: the Vietnamese Migrants)
are resolved by the Hong Kong Government before 1997; and ensure that the future SAR government is compliant thereafter.
3.
The Chinese believe their policy will not undermine Hong Kong's continued stability and prosperity. However, their statements or
actions could easily damage confidence. Beijing's unco-operative
attitude towards the Nationality Act, Bill of Rights and Port and
Airport Development Scheme, together with comments on other issues
recently, including the extent of the PLA presence in Hong Kong post- 1997 and the introduction of direct elections, indicate that they hope to force HMG to consult Chinese officials more frequently on internal
Hong Kong matters. This erodes HKG's authority which, even without
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