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IN ORDER TO CREATE THE POSSIBILITY OF AN ACCEPTABLE DEAL, I BELIEVE WE HAVE TO CONVINCE THE CHINESE THAT WE ARE PREPARED TO FACE HE PROSPECT OF NOT GOING AHEAD WITH THE AIRPORT DESPITE THE PROBLEMS THAT WOULD CAUSE. OTHERWISE I SEE LITTLE PROSPECT OF A TOLERABLE AGREEMENT.
7.
THE
I ENTIRELY AGREE THAT THE SECRETARY OF STATE SHOULD NOT/NOT ENGAGE IN DETAILED FINANCIAL NEGOTIATIONS ON HONG KONG'S BEHALF. BUT THIS PROBLEM GOES WELL BEYOND THE NEED TO PRESERVE HONG KONG'S AUTONOMY IN ECONOMIC AFFAIRS. THE CHINESE ARE NOW CLEARLY TRYING TO RESTRICT THAT AUTONOMY BOTH NOW AND BY IMPLICATION BEYOND 1997. IN THAT, LONDON CANNOT STAND ASIDE. IF IT DID, MESSAGE TO PEKING WOULD BE THAT HMG WILL NOT EXERT ITSELF ON BEHALF OF THE PRESENT HONG KONG ADMINISTRATION OR TO MAINTAIN THE PROVISIONS OF THE JOINT DECLARATION. WE THUS NEED STRONG BACKING ON THE POINTS OF PRINCIPLE.
8 =
IN THIS CONNECTION, I HAVE TWO COMMENTS ON THE DRAFT MESSAGE IN SECOND TUR, WITH WHICH I AM OTHERWISE CONTENT. THESE ARE TO OMIT THE SECOND SENTENCE OF THE FINAL TIRET, AND TO ADD A FINAL SENTENCE TO READ: QUOTE HOWEVER, SUCH DISCUSSIONS ARE OBVIOUSLY UNLIKELY TO BE FRUITFUL IF THEY TAKE PLACE AGAINST A BACKGROUND OF COMPLETE DISAGREEMENT ON SOMETHING AS MAJOR AS THE AIRPORT PROJECT UNQUOTE. THIS IS INTENDED TO AVOID GIVING THE IMPRESSION, WHICH MIGHT BE WELCOME TO THE CHINESE, THAT A COSY BILATERAL RELATIONSHIP WITH THE U.K. IS STILL ACHIEVABLE EVEN IF HONG KONG IS GOING WRONG.
9. IF AS A RESULT OF THIS MESSAGE WE GET SOME INDICATION FROM THE CHINESE THAT THEY WANT TO REACH A DEAL DURING THE SECRETARY OF STATE'S VISIT, THEN WE MUST TRY TO MAXIMISE OUR LEVERAGE. IF HE GOES UNACCOMPANIED BY ANYONE FROM HONG KONG, WE WILL BE GIVING THE CLEAR IMPLICATION THAT WE DO NOT ENVISAGE ANY DETAILED DISCUSSION TAKING PLACE DURING HE VISIT. BUT I REMAIN VERY CONCERNED THAT IF WE CANNOT CONCLUDE A SATISFACTORY DEAL DURING THE VISIT, THERE COULD BE SERIOUS UNRAVELLING AFTERWARDS. AFTER LAST WEEKEND'S TALKS, A SIGNIFICANT NUMBER OF FINANCIAL MATTERS REMAIN OUTSTANDING. OUR AIM SHOULD THEREFORE BE TO BE PREPARED FOR DETAILED TALKS WITHOUT GIVING THE CHINESE ANY ADVANCE INDICATION THAT WE ARE. IN THESE CIRCUMSTANCES THE BEST APPROACH MIGHT BE FOR MACLEOD AND EHRMAN TO BE READY TO GO TO PEKING ON 5 APRIL, IF IT APPEARS FROM THE SECRETARY OF STATE'S TALKS ON 4 APRIL THAT THE CHINESE ARE PREPARED TO HOLD SERIOUS DISCUSSIONS. I WILL COMMENT SEPARATELY ON THE IDEA THAT I MIGHT GO MYSELF, TO WHICH I AM NOT/NOT ATTRACTED.
11.
GALSWORTHY HAS SEEN THIS TELEGRAM IN DRAFT AND HIS VIEWS HAVE BEEN INCORPORATED IN IT.
WILSON
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HMLNAN 6867
Redacted Under FOI Exemption Sec 27(1)(a)(c)(d)
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