TNAG-0848-FCO40-1058-Future-of-Hong-Kong-New-Territories-leases-1979 — Page 121

Mr McLaren (HK&GD)

SECRET

THE OUD/

INDEX

2 8 MAR 1979

13:

Hong Kong: New Territories Leases

The Secretary of State has seen your submission of 2 March and has approved the draft telegram with some amendments which are attached. The Secretary of State thinks that the Governor should go ahead provided he has squared his Executive Council and is confident he can carry Hong Kong. The Secretary of State has also asked whether there is any likely focus of dissent in Hong Kong.

The Secretary of State would like to put a minute to DOP as soon as possible and I should be grateful if a draft DOP paper could reach me by Wednesday lunchtime, 14 March.

The Secretary of State has made a few specific points, which should be brought out and explained in the DOP paper. These are:

a)

b)

It will be important to ensure that our solution does not backfire on us by seeming to rob the lessee of his security up to 1997. The Secretary of State is aware of the means by which we propose to cover this point but it should be explained.

The Chinese might turn sour on us again in five or ten years. If the Chinese mood changes and we have made leases indeterminate, lessees might feel (despite article 4) that they had lost even the fig-leaf of security that they had under the previous arrangements.

12 March 1979

cc:

PS

PS/Lord Goronwy-Roberts PS/PUS

Sir A Duff

Mr Murray

Ам

(J S Wall)

Mr Cortazzi

Mr Stephen FED

PUSD

Research Dept

Mr Rushford, Legal Advisers

SECRET

35.