CONFIDENTIAL

Recent agreements in the JLG concern Hong Kong's

extradition arrangements, Investment Promotion and

Protection Agreements with foreign countries and

multilateral treaties concerning health, conservation and

trade. Areas being dealt with currently include Mutual

Legal Assistance and the localisation of UK enactments

applied to Hong Kong. JLG XXII was held in Hong Kong from 24-26 March. Precious little progress was made. We remain deadlocked on two key issues: how much of the land currently

occupied by British Forces should be handed over to the PLA

post-1997; and Air Services Agreements, where we are in the process of separating off Hong Kong's ASAs from the UK's.

Democracy

The first direct elections to the Legislative Council took

place on 15 September 1991 (18 seats out of 60 were

directly elected). Other changes included an increase in

the number of functional constituency seats from 14 to 21;

a reduction in the number of official members from 10 to 3;

a reduction in the number of appointed members from 27 to

18; and the appointment of a Deputy President, who will

preside over most council sessions instead of the Governor.

- We are committed to going back to the Chinese to press for

an increase in the number of directly-elected seats in 1997.

This is currently 20, as stipulated in the Basic Law (BL).

Certain sectors in Hong Kong (and here) think it should be

much higher. The Chinese have made clear that the BL

cannot be changed.

New Governor

- Lord Wilson of Tillyorn has served as Governor of

Hong Kong for the past 5 years. He has done, and continues

to do, an excellent job. He has the Goverment's full

confidence, as the honour awarded to him demonstrates.

was never the intention that he should serve until 1997.

It

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CONFIDENTIAL

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