7.

If one can persuade interlocutors to lift the needle out of e groove (and as a newcomer I tend simply to listen) and

ask whether the main threat to Hong Kong is not from China/US, the answer in many cases is yes. It is therefore surprising

that the Governor's insistence on the importance for Hong Kong

of his relationship with the incoming US administration in Washington has not received more serious attention in the business community. But it is a powerful argument and the

more thoughtful businessmen are likely to support the Governor

on this point.

8. At a lunch I gave for the Commonwealth representatives today there was strong support for the Governor from all but

the Singaporean. He agreed that the Chinese had to be handled

in a special way, historical mistrust etc. Others around the table disagreed.

9. Sir Hugh Bidwell (leader of the British Invisibles

mission to China) and Lord Young were both in Peking recently

and spoke to local media about the warmth of their reception

and the Chinese stress on keeping business apart from Hong Kong politics. The message played well locally and aroused interest for many businessmen it was hard evidence, to balance against the mass of press reports. Lord Young said privately that he believed the Hong Kong business reaction to

be strongly hostile but I was not convinced that he was

reflecting a great deal of hard evidence.

10. A Jardines' lunch yesterday was remarkably un-fussed.

There was support for the suggestion that some Hong Kongers

followed what in the Gulf we termed a policy of pre-emptive

submission (vis-a-vis Iran in that case). But the majority,

including a surprising number of politicians were prepared to

stand up and defend their own futures

significant development.

13/11/92

and that was seen as a

S P Day

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