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SECRET UK EYES A

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Britain's Commitment

to Mary Kars,

alre difficult relations that existed between the UK and the

People's Republic of China (PRC) due to the Chinese leadership's deep

suspicion of Britain's aims and intentions regarding Hong Kong. The role of the Garrison as the guardian of British Sovereignty so contributing to confidence and stability in the Territory, will not

change; but its size, its activities, and the process of its withdrawal will nonetheless inevitably be subject to close political and public scrutiny until 30 June 1997.

ASSESSMENT OF THE THREAT

5.

The Joint Intelligence Committee (JIC) concluded5 that the

stability of Hong Kong in the run-up to the handover to the PRC depends on the maintenance of political and commercial confidence in

the Territory. Hong Kong's sound economic performance and the ascendancy of economic reformers in Peking bode well for this.

However, the PRC leadership remains highly suspicious of British

policy, and their statements and actions, such as the hostile response

to the Governor's proposals for democratic reform, can (and often do)

damage confidence. The Chinese maintain the right to intervene if, in

their view, Hong Kong appeared to be descending into chaos or if HMG

had reneged on the Joint Declaration. They might also adopt this course if they judged that they would otherwise inherit a Territory dominated by independent and assertive political groups (for example, the United Democrats). However, they are aware that such action would

affect their own economic interests adversely and would be applied as

a last resort only. Accordingly, the JIC has concluded that the threat

of military intervention before the handover, while greater than it

JIC(91) (N)1 1991.

The Threat To Hong Kong, dated 10 January

3

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