CONFIDENTIAL

SECRETARY OF STATE'S BILATERAL WITH MRS MCDOUGALL AT THE G7

IN MUNICH

Points to make

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Pleased with the flexibility in Canadian Immigration Rules which permit Hong Kong people to obtain Canadian residence.

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Grateful for your help with confidence building measures for Hong Kong's future.

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Useful if you can take opportunities with Chinese to

emphasize importance you attach to Hong Kong's continued stability and prosperity as set out in the Joint

Declaration.

Reports indicate that general confidence in Hong Kong is higher than it has been for some years.

JH2AFQ/1

CONFIDENTIAL

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