TNAG-0841-FCO40-1050-Visit-of-Sir-Murray-MacLehose--Governor-of-Hong-Kong--to-Chi-1979 — Page 63

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Chinese acceptance of the need

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to maintain confidence in Hong Kong if the right sort of investment was to continue. Mr Deng sa id "I formally request you to tell investors in Hong Kong to put their hearts at ease". While Deng clearly did not contemplate any early political change in Hong Kong, he envisaged that when it came it would be accompanied by a special status, similar to Taiwan, in which investments and the capital economy and standard of living would be assured.

Deng did not seem aware that such assurances would give no confidence unless China's political life had settled down for many years, or there was a satisfactory example of how a special status worked out in practice, eg in Taiwan.

The action we propose to take over land leases was explained both to Mr Deng and to Foreign Minister Huang. The initial reaction was not

conclusive, but as good as could have been expected. I will be making recommendations about next steps in the light of Chinese reactions over the next month.

Hong Kong's problem of legal and illegal immigration from China was raised at all levels.

The visit was a significant step in building up a normal relationship, and the precedent of contact between the Governor and officials may prove useful in the future.

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