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of commercial judgement. If anything involved official problems they
could be discussed but I did not foresee any real difficulties. I
mentioned the need to ensure that the requirements of Certificates of
Origin were met if joint production for eventual export from Hong Kong
was involved.
But all
I do see scope for development of joint production.
this of course is a matter for the commercial judgement of the private
sector.
I should say that I continually stressed the point that there
will be no advantage to China in displacing Hong Kong products in third
markets. The value of the increase in Chinese exports to third markets
would simply be offset by the decrease in prosperity and purchasing power in Hong Kong and therefore of Chinese exports to it. We could
both profit only by considering our mutual benefit.
In response to Chinese exhortations for greater economic
cooperation and the greater deployment of Hong Kong's industrial, commercial and financial capability for the mutual benefit both of China's modernisation programmes and Hong Kong, I stressed the unique capacity
which Hong Kong and her businessmen possessed and the very great
contribution they could make given commercially attractive contracts,
security for investment and reasonably quick decisions.
We were briefed in detail by the Guangdong Water Engineers
on their latest thinking on how to solve our need for increased water
supplies after 1982. They have done a lot of work on this and their
Alternative new schemes which would serve both their need for irrigation
/and ours