Line to take

CONFIDENTIAL

(State open objective as above)

The British Government which is elected on 9 April is

likely to be in office for most of the rest of the period

up to 30 June 1997. We want to ensure that it

contributes as effectively as possible to the task of promoting Hong Kong's prosperity and stability on the

basis of the Joint Declaration.

Better not just to react to events: we cannot predict

every aspect of the future, but the more we can think

ahead the better.

(a)

(b)

So we need to know what Hong Kong is likely to want out

of HMG over the next five years:

in terms of negotiating with the Chinese, at all levels

from the Prime Minister down, and

in terms of national UK decessions, eg ECGD cover for projects, and

(c) in terms of international lobbying.

We have a good idea of the issues and requirements on the political front but need a better idea of those on the

economic/financial front.

-

We should like to hear your views on these points and to

learn what you think we need to know about the background

to the issues and your decisions in order to play a helpful role.

Stress again: the decisions are yours our interest in not to encroach on HKG's economic and financial autonomy

but to strengthen it.

ASHAIN/3

CONFIDENTIAL

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