TNAG-0849-FCO40-1059-Future-of-Hong-Kong-New-Territories-leases-1979 — Page 138

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explaining it as something which lay within the powers of the

Eritish administration but was consistent with the Chinese position

and required no positive action on their part. Deng did not

specifically endorse the proposal and may not have fully under-

stood what was involved. but he did not react adversely and his

general remarks about the future of liong Kong were clearly intended

to reassure investors that they had nothing to fear.

6. There has so far been no further Chinese reaction to the ideas

which the Governor put forward. If nothing is heard within the

next few weeks, Ministers will need to decide what further steps

should be taken to ensure that our ideas have been correctly under-

stood. A separate submission will be made in due course.

Hong Kong and General Department

8 May 1979

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