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F7.

Speaking to the publisher and chief editor of WWP, Lu Ping said that if no agreement could be reached, the

Chinese side would adopt all measures to ensure that Hong Kong would have a smooth transition, not only politically but, more important, economically; if Hong Kong's economy remained stable, other problems would be easy to deal

with. Lu Ping said that the Chinese side definitely regarded the political talks as important, but the question of Hong Kong's economy was equally important. He said that the Chinese side considered that political and economic matters should be separated but in practice this was difficult to do. If the talks broke down, who could say

that Hong Kong and investors' confidence would not be affected? The role of the Chinese side would be to

minimise the effects and create good conditions for the

future SAR and a sound basis for the continued development

of Hong Kong after 1997 (WWP 26 October 1993).

F8.

Lu Ping told a delegation of Yan Oi Hospital that

it was difficult to say that the economy would not be affected by a breakdown in the talks. However, China would make every effort to minimise the effects (WWP 29 Oct

1993).

BRITISH INTERESTS/SINO-BRITISH RELATIONS

G1.

Asked about criticism of "a leading British trading company" by NCNA, Lu Ping said he thought the

reason for the criticism was not because the company was

British or because it supported Mr Patten's proposals but

mainly because although the company profited from the contributions of Hong Kong taxpayers for many years it had

adopted an "extremely irresponsible attitude". He added that this was an isolated case unrelated to other companies

whether British, Chinese or US (TKP 4 January 1993).

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