RESTRICTED

8.

22.

That has gone, but the secretive instincts linger, to a degree that is strange even by comparison with Whitehall. It is important that the increased authority and self

confidence of Legco should not be matched by a heightened

secretiveness on the part of officials who are inevitably

worried about their future.

23. I can illustrate these points with two examples

i) For the first celebration in Macao of Her Majesty's

Birthday after a break of 50 years an unusually happy event

we needed a Union Jack to match the particular size of the Portuguese flag lent by the office of the Governor of Macao.

After due consultation within the Hong Kong Government I was

told this was impossible since the loan might give rise to

suggestions of unfair advantage.

ii) A recent meeting was interrupted by a courier bearing a

sealed letter marked Urgent, Confidential, Open by Addressee

Only. It turned out to be a HKG copy of a circular to FCO

posts seeking nominations for a garden party at Buckingham

Palace.

24. These are not isolated examples. But the situation has

changed and there is no group with whom I feel more

comfortable than the able and dedicated servants of the Hong

Kong Government. My confidence in the future of Hong Kong is

based on my admiration for these civil servants, the

businessmen with whom I spend my working day, the members of

Exco and Legco, and the talented academics.

The Importance of Trade

25. British trade will depend on getting a China strategy

right and seeing it through. Hong Kong will increasingly be

the brains and money capital a world class financial centre

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