CONFIDENTIAL

File

7

HKD 021/1

Ch/Jap 15

IS

VISIT OF LORD CAITHNESS TO JAPAN, 13-16 FEBRUARY

China/Hong Kong: International Support

Points to Make

-

Prospects for Hong Kong look good. South China economic development irreversible. Hong Kong's success hinges on

its economy.

But we also need to create the right

political environment.

As Douglas Hurd told [you/Mr Watanabe] in Washington on

22 January, we are grateful for Japan's efforts to

influence China. [Your/his] comments on democracy

particularly helpful.

Not a message that China wants to listen to, but

important that she is told frankly that the developing

democratic system is essential to the maintenance of

Hong Kong's stability and prosperity and that Chinese

attacks on it undermine business confidence in the One

Country Two Systems policy.

Helpful if Japan could encourage China to talk to the 18 directly-elected LegCo members instead of showing public

suspicion and hostility. China will win more with a smile

than with a frown. We encourage LegCo to reciprocate.

- Also important to continue to remind China (as [you/Mr

Watanabe] have/has been doing) that a confrontational

policy towards Hong Kong could discourage foreign

investment.

WEDADT/1

ZBy

Share This Page