practice of granting leases running over the end
4
of our own lease were continued, the position
might arise in which the Hong Kong Government
had granted a lease of which the greater part was in what we may call the Chinese period in return for a large premium and no rent or very little rent.
The Chinese could then argue that the Hong Kong
Government was selling rights it did not properly
& hocheting the proceeds
possess, and even if we reply that the money was being spent on the development of the territory,
they might complain that we were squandering its
resources.
I am inclined to think, therefore, that
it will be useless to press the Governor's proposal.
His objections to the solution agreed upon with the
Foreign Office are not very clearly stated, but they
appear to hinge on the undesirability of stating or implying in any published document that there is
any
possibility of the termination of British control
of the New Territories. He says that it is
undesirable that the Government should admit that
the future of the New Territories is an open
question. I should have thought that it was very
desirable that the Government should make it clear
that this is an open question. If it is closed it
seems to me it must be regarded as closed against
us, not in our favour. The legal position is
perfectly clear, that at the end of the 99 years
the New Territories are pledged to revert to the
complete sovereignty of China. When that time
comes there is no doubt that we shall have to
insist for practical reasons their close connect ion with Hong Kong etc.)on some other solution of
their future, but it would be impossible for H.M.G.
to