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always been quick to react to any action by the Hong Kong
Government which they considered a threat to the Communist press
or schools, or to the trade unions. But provided that due heed
is paid to their known susceptibilities, the Chinese are likely
to acquiese in the way the Colony is administered.
3.
The evolution of more moderate policies in China itself
has been accompanied by less militant behaviour by the Chinese
Communists in Hong Kong. The local Hong Kong communists are
under firm instructions from Peking to stay within the law and
to direct their activities to building a broad political base in
the Colony. The few remaining "confrontation prisoners" still
serving sentences for their part in the disturbances in 1967
(there will only be 4, out of the originally 1800, still in
prison by Chinese New Year) remain a small but continuing point
of friction in Sino-Hong Kong relations, although there is now
little pressure from the local communists for their release.
4. Hong Kong provides China with easy access to world markets
and serves as an invaluable base for propaganda and intelligence
activities. Hong Kong also depends heavily on China for essential
supplies, especially food. It is of direct and substantial
economic value to China; at least one third of China's foreign
exchange income is earned from sales to and remittances from the
Colony (just under £350 million out of about £1000 million in
1970). These earnings play a major role in financing China's
trade deficits with other areas of the non-Communist world and
her overseas aid. Yet the presence of a flourishing colonial
/society
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