UM FYES k
Page 2 of 5 pages
3. China is heavily involved in all aspects of Hong Kong's commerce and finance
but it is not known what proportion of Hong Kong's GDP is contributed by communist
commercial activity. The 13 communist banks have opened on average 9 new branches annually over the last 8 years and now have 15% of all bank branches in Hong Kong. New modern shop premises are being opened for the sale of
Chinese products. In a logical marketing extension the Chinese firm (FEOSC)
supplying petroleum products to Hong Kong has opened 5 petrol retail stations.
Flans are well advanced to diversify Chinese commercial interests into machine
tool manufacturing (using components supplied by China and selling to USA as well
as South East Asia) and ship repairing (the planned provision of a 30,000 ton đượ
dock has been reported).
FUTURE POLICY
4. There have been numerous indications in recent months
(described in Annex ) that the Chinese government is whole-heartedly
in favour of the status quo continuing in Hong Kong because this will maximize the
economic advantage that accrues to China. The economic benefits of Hong Kong are
continually stressed by Chinese officials at all levels
Chairman Hua Kuo-feng is fully aware of the economic value of Hong
Kong. It is apparent that the scale of Chinese plans to import Western advanced
technology over the next 8 years (ie to 1985, the end of the current planning period)
will require the continued expansion of foreign exchange earnings from all possible
sources. We consider it will be a major goal of China's foreign policy to do nothing
to undermine this expansion.
UK EYES A
THIS IS A COPY
THE ORIGINAL HAS BEEN RETAINED IN THE DEPARTMENT UNDER
SECTION 3 (4) OF THE PUBLIC RECORDS ACT 1958
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