As Chris Patten makes plain, we believe that it should be possible to reach agreement with the Chinese Government on arrangements which are fully compatible with the Joint Declaration, the Basic Law and any other relevant agreements. We shall continue the talks in October with that aim: the next Round is on 11 - 12 October. But we now have only weeks rather than months to conclude these talks if enough time is to be left to make the practical arrangements for elections in 1994 and 1995.

Whatever the outcome of the talks, it will be for the Legislative Council to consider and pass the necessary legislation. Chris Patten emphasises that the Hong Kong Government will not - indeed cannot go further than the

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community and its legislature wish them to do.

Our responsibility for holding elections in Hong Kong is of course only one aspect of our wider responsibility under the Joint Declaration to administer Hong Kong until 30 June 1997. We intend to carry out that responsibility to the full. There will also be a continuing need for Britain and China to work together over Hong Kong. In the economic field we hope that the Chinese side will turn their words about preserving Hong Kong's prosperity into deeds and agree soon on financing arrangements to allow Hong Kong's new airport to be completed. The same applies to Hong Kong's Ninth Container Terminal, which is already running late because of the delay in reaching political agreement to proceed. On the Joint Liaison Group, Chris Patten sets out in his speech a number of examples of the way in which peoples' lives will be affected in Hong Kong after 1997 if we cannot successfully complete the agenda of technical issues. We would like to see much faster progress here.

It is likely to be a busy autumn on Hong Kong. We will of course keep Parliament fully informed of developments.

Absti

ALASTAIR GOODLAD

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