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There is evidence that China's current conclusion is to leave
things as they are.
General Aims
40. The Chinese intention is to take over Hong Kong, by
1997 at the latest. For the present, however, they seek to gain the maximum degree of control over our actions consistent with the maintenance of Hong Kong's value to them. They seek
a measure of control sufficient to leave them poised to take over at any convenient time when we would either be bustled
out ignominiously or held as hostages.
41. The Chinese will move to recover Hong Kong whenever the disadvantages to them of our position there outweigh the advantages they derive from Hong Kong's retaining a separate existence. They will use whatever forcible means are necessary, which will include the mounting of a campaign of internal violence supported by imported trained agents and
weapons.
42. It is likely that China would prefer not to have to take Hong Kong by direct military attack, though such an attack could not but succeed. It would be more in keeping with China's position on the efficacy of indigenous revolution to create a situation in which local action would seem to have caused a total breakdown and where a resort to military force would be necessary, if at all, only to administer the coup de grace. However, a display of military force might be mounted in order to allow the Chinese to pose to the populace as "liberators": and all else failed and a take-over became imperative, direct attack would unhesitatingly be resorted
to.
Short-term Policies
43.
The Chinese recognise that the events of 1967 showed they could not achieve dominance except by the use of violence to a degree which would have gravely impaired Hong Kong's value to them. This price they were not prepared to pay. Their present policy is to expand their commercial interests in the Colony and to concentrate on building up their support. To this end they are rebuilding the local communist apparatus and will seek to use this apparatus to achieve by persuasion,
/propaganda,
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