UNCLASSIFIED
155063
MDLIAN 1215
ACTION. SIR DAVID SAID THE POLICY WAS JUST A TEMPORARY MEASURE AND DID NOT STRADDLE 1997, THEREFORE THE GOVERNMENT DID NOT ENTER INTO FORMAL NEGOTIATION WITH THE CHINESE SIDE. THE GOVERNMENT HOWEVER, WOULD DISCUSS WITH THE CHINESE SIDE LONG TERM ARRANGEMENTS.
TALKS
8. QUOTING SOURCES CLOSE TO THE BRITISH SIDE, THE UK ECONOMIC JOURNAL (12.8) SAID THE BRITISH SIDE PLANNED TO PRESENT COUNTER-
PROPOSALS TO THE ONES PUT FORWARD BY THE CHINESE SIDE REGARDING FUNCTIONAL CONSTITUENCY ELECTIONS AND THE ELECTION COMMITTEE AT THE NINTH ROUND. APART FROM REFUSING TO INCLUDE THE CHINA ENTERPRISES ASSOCIATION AND THE INSURANCE INDUSTRY AS TWO OF THE NEW FUNCTIONAL CONSTITUENCIES, THE BRITISH SIDE WOULD ALSO STRIVE TO BROADEN THE BASE OF THE ELECTORATE AND THE REPRESENTATIVENESS OF THE OTHER NEW
FUNCTIONAL CONSTITUENCIES PROPOSED BY THE CHINESE SIDE. THE BRITISH SIDE WOULD ASK FOR ONE MAN, ONE VOTE' TO REPLACE THE CORPORATE VOTING PROPOSED BY THE CHINESE AND SUGGEST MAKING THE
HOTEL AND CATERING INDUSTRY A NEW FUNCTIONAL CONSTITUENCY. THE SOURCES STRESSED THE THROUGH TRAIN REMAINED THE KEY ISSUE OF THE NEGOTIATIONS. THE PAPER QUOTED CHINESE SOURCES AS SAYING THE CHINESE SIDE WERE WILLING TO DISCUSS IF THE AMENDMENTS WERE BASED ON THEIR PROPOSALS. THE CHINESE SIDE CONSIDERED COUNTER-PROPOSALS OUTSIDE THE GOVERNOR'S PACKAGE WOULD BE SUEFUL TO PROGRESS OF THE TALKS AND HOPED A CONSENSUS ON THE ELECTION COMMITTEE AND THE FUNCTIONAL CONSTITUENCY ELECTIONS WOULD BE REACHED BY END SEPTEMBER WHEN THE TWO MINISTERS MET IN NEW YORK.
9. THE HK ECONOMIC JOURNAL (13.8) QUOTED SOURCES CLOSE TO THE TALKS AS SAYING IN THE LAST ROUND THE CHINESE SIDE HAD RAISED THE QUESTION OF NATIONALITY RESTRICTIONS IN THE 1995 LEGCO ELECTIONS. UNDER ARTICLE 67 OF THE BL, ONLY ONE-FIFTH OR 12 OF THE LEGCO MEMBERS COULD BE FOREIGN PASSPORT HOLDERS AFTER 1997. THE CHINESE SIDE HOPED THE BRITISH SIDE WOULD COOPERATE ON THIS AND MAKE APPROPRIATE ARRANGEMENTS IN THE 1995 ELECTORAL LEGISLATION. THE SOURCES SAID THE CHINESE SIDE DID NOT PROPOSE CONCRETE METHODS TO DEAL WITH THE PROBLEM BUT BELIEVED THIS WAS AN IMPORTANT CRITERION OF THE THROUGH TRAIN AND WAS ESSENTIAL FOR CONVERGENCE WITH THE BL. THE CHINESE SIDE HAD DRAWN UP A NUMBER OF BLUEPRINTS AND THEY WOULD NOT INSIST ON RESTRICTING THE 12 SEATS TO THE FUNCTIONAL CONSTITUENCIES. THEY HOPE CONSENSUS COULD BE REACHED WITH THE BRITISH SIDE SO THAT THE ARRANGEMENT COULD BE IMPLEMENTED IN THE 1995 ELECTIONS.