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ineffective and lacks credibility;

and that the addition of

His

the liberals to the present membership would lead to

in-fighting and further reduce its effectiveness.

judgement, with which I agree, is that his proposed change should be broadly accepted in Hong Kong. I therefore doubt

that it will create too much fuss here. The Chinese will of

course be greatly relieved to see that Martin Lee and his

group have not been appointed to ExCo.

The 1995 elections raise more difficult political points. There are expectations in Westminster and internationally that

for these last elections under British sovereignty we will aim

for a significant increase in the number of directly-elected

LegCo members. But if the LegCo elected in 1995 is to be

permitted by the Chinese to continue through 1997 until the

next LegCo elections in 1999 (the so-called "through train"),

then we must take account of the provisions of the Basic Law which will come into operation in 1997. This envisages a

gradual increase from the present level of 18 to 20 for the

LegCo which makes the transition in 1997, rising to 24 at the

1999 elections.

We are publicly committed to pressing the Chinese for a more

rapid build-up than this in the number of directly-elected seats. We believe that there is no prospect of their agreeing

to amend the Basic Law to this effect. The Governor's view is

that we would have little support in Hong Kong if we were to

lose the prospect of a LegCo through-train by unilaterally

increasing the number of directly-elected seats. He therefore

recommends that we should carry out our commitment to raise the issue with the Chinese but be prepared to use it as a

bargaining card in return for Chinese agreement on points which will be more attractive to Hong Kong.

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