UNCLASSIFIED
143717
MDLIAN 0500
SEE A SMOOTH TRANSITION AND HAD A GREAT ECONOMIC STAKE IN HONG
KONG.
9.
THE PRO-PEKING PRESS (4.12) HELD THE GOVERNOR RESPONSIBLE FOR THE CONTINUED FALL IN THE STOCK MARKET. WEN WEI PO CLAIMED THE 'THREE VIOLATIONS' HAD TRIGGERED AN OPEN DISPUTE BETWEEN THE TWO SIDES AND CAUSED CONCERN ON THE PART OF INVESTORS. IT WAS INEVITABLE UNDER THE CIRCUMSTANCES FOR THE CHINESE SIDE TO MAKE KNOWN THEIR STANCE ON GOVERNMENT CONTRACTS AND UNDERTAKINGS STRADDLING 1997 TO PROTECT THE INTERESTS OF INVESTORS. IT CLAIMED THE CHINESE MOVE WAS CONDUCIVE TO LONG TERM PROSPERITY AND STABILITY. TA KUNG PAO ALLEGED THE GOVERNOR HAD IGNORED ALL WARNINGS IN HIS CONFRONTATION AGAINST CHINA. THE PAPER SAID IN ORDER TO MAINTAIN STABILITY AND PROSPERITY AND ENSURE A SMOOTH TRANSITION, THE GOVERNOR SHOULD RETURN TO THE PATH OF THE JD,
AND SINO-BRITISH
UNDERSTANDING.
BL
10.
PAPERS NOTED (5.12) IN PROMINENT COVERAGE THAT LORD HOWE SAID IN PEKING THAT BRITAIN'S INTEREST AND THE GOVERNOR'S INTEREST WERE SOLELY IN SECURING THE BEST POSSIBLE FUTURE FOR HONG KONG. LORD HOWE COMMENTED THE DISPUTE COULD NOT BE SOLVED VIA OVERSIMPLIFIED CRITICISMS. LORD HOWE HOPED THE CHINESE SIDE COULD PUT FORWARD CONSTRUCTIVE COUNTER PROPOSALS. HE BELIEVED PROGRESS WOULD BE MADE AT SOME POINT AND THE CHINESE SIDE WOULD UNDERSTAND THE GOVERNOR WAS TRYING TO FIND THE BEST WAY FORWARD FOR HONG KONG IN ACCORDANCE TO THE JD AND BL.
11. REPORTS NOTED (5.12) THAT THE HANG SENG INDEX REGAINED ALMOST 300 POINTS AN ARTICLE ISSUED BY THE CNA SAID HONG KONG'S POLITICAL QUESTION REMAINED UNCHANGED AND INVESTORS SHOULD BE CAREFUL ABOUT BUYING.
12.
REFUTING REMARKS MADE BY SIR PERCY CRADDOCK ON HONG KONG'S POLITICAL DEVELOPMENT, THE CHAIRMAN OF THE COMMONS FOREIGN AFFAIRS SELECT COMMITTEE, DAVID HOWELL, SAID THE GOVERNOR'S REFORMS WERE CONSISTENT WITH THE JD AND BL, AND WERE GRADUAL AND NON-REVOLUTIONARY. IT WAS NOTED THAT THE MINISTER FOR SPECIAL RESPONSIBILITY FOR HONG KONG, ALISDAIR GOODLAD, REITERATED IN AN INTERVIEW WITH THE BBC THAT THE BRITISH GOVERNMENT FULLY SUPPORTED THE GOVERNOR AND HIS CONSTITUTIONAL PROPOSALS.
13. REPORTS NOTED (7.12) THE BRITISH AMBASSADOR TO CHINA, SIR ROBIN MCLAREN, TOLD REPORTERS ON ARRIVAL IN HONG KONG THAT HIS VISIT WAS A ROUTINE ONE AND HE DID NOT CARRY ANY SPECIAL MESSAGES
3
PAGE UNCLASSIFIED