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5.. (contd)
to draw firm conclusions about trends in Chinese exit policy, apart from a general liberalisation. Chinese bureaucratic practice varies considerably. I have, for instance, seen a "pink" permit issued in Shanghai which differed slightly in format from the corresponding permits issued by the Kwengtung Public Security Bureau and was for someone "formerly resident in Hong Kong" with no mention of an onward destination. Furthermore, the standard pattern in which Immigration Department set out their statistics (you will have seen examples) assigns both types of permit (not passport) holders into categories based on place/language or origin: Kwangtung residents, non-Kwangtung residents and Overseas Chinese. Inevitably, the lines between these categories are blurred. For what it is worth, according to these figures a slightly smaller proportion of arrivals this year were Overseas Chinese (14% compared with 16.2% in 1977).
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6.
Proper statistical analysis of the figures could probably extract underlying long-term trends from the annual fluctuations. At any rate, it is clear that on any given date there will be Hong Kong residents in China, even if within selected periods the balance of movement shows a net inflow of Hong Kong residents.
inflow to where?
7.
There is no doubt a slight risk in giving the Chinese such detailed statistics that they may try to use them to produce arguments to show that our concern over the level of immigration is exaggerated. We have already told them that we would be delighted to be proved wrong: we see no difficulty in agreeing that the total new arrival figures tend to overstate the problem slightly by failing to allow for the small numbers of people returning on Chinese documents or the small net outflow at Lowu of travellers on Hong Kong documents (see para 3 above). Those who arrive on passports with visas for onward destination (2.9% of new arrivals January 1977 - July 1978) could also be discounted since we estimate that about 90% of them leave within a few months. On balance, new arrival figures probably overstate the problem at present by about 6% (this estimate takes into account the lower proportion of arrivals this year who have onward visas).
8.
A case could be made out for revising the public presentation of figures for immigration from China. However, the benefits of doing so seem marginal when the difference is so slight. We would also have to add a mass of explanatory notes which might suggest that the figures were being cooked to minimize the problem. Furthermore, if corrections were
CONFIDENTIAL
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