TNAG-0848-FCO40-1058-Future-of-Hong-Kong-New-Territories-leases-1979 — Page 68

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ON THEIR PART. AS MIGHT BE EXPECTED, THE REACTION IS NOT ABSOLUTELY CLEAR. THERE HAS BEEN NO HMMMEDIATE NEGATIVE RESPONSE. LIAO, WHEN GIVEN AN OPPORTUNITY TO SIGNAL THAT WE WERE ON

THE WRONG LINES, DID NOT DO SO. HUANG, ON THE OTHER HAND, WAS MORE CAUTIOUS.

6. WE MUST NOW GIVE AN OPPORTUNITY FOR WHAT HAS BEEN SAID TO SINK IN. I DO NOT THINK THAT ANY IMMEDIATE FOLLOW-UP ACTION IS REQUIRED. MY INITIAL VIEW, AND THAT OF THE GOVERNOR, IS THAT WE SHOULD NOW LET THE MATTER REST FOR A LITTLE WHILE.

WHEN WE ARE READY FOR THE NEXT STEP IT MAY BE ENOUGH-TO

INFORM THE CHINESE OF WHAT WE INTEND TO DO AND WHEN.

DETAILED DECISIONS ON FURTHER TACTICS CAN BE TAKEN AT THE

TIME. MEANWHILE, IF THE CHINESE ARE GOING TO REACT STRONGLY AGAINST THE ACTION WE ARE CONSIDERING TAKING, WE CAN PROBABLY EXPECT TO PICK UP SIGNALS DURING THE COMING WEEKS.

7.

BUT

THE GOVERNOR HAS SEEN AND AGREED THIS AND MY IPT.

CRADOCK

[SENT BY BAG TO HONG KONG]

FILES

HD.HK & GD

HD. FED

PS

PS/LORD GORONWY ROBERTS

PS/PUS

SIR A DUFF

MR. CORTAZZI

MR.MURRAY

COPIES TO:

SIR IAN SINCLAIR

LEGAL ADVISER

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