TNAG-0849-FCO40-1059-Future-of-Hong-Kong-New-Territories-leases-1979 — Page 159

The pount a Ikan the

auflad

intention to

8.

(e)

SECRET

and destructive arguments about what is meant by Hong Kong's "special status". Does not square with HMG's present position on the status of Hong Kong.

Use "as long as the New Territories are administered as part of Hong Kong".

Advantages: Fits with the British view of Hong Kong. Able to carry leases beyond 1997.

Disadvantages:

Could

Could be construed by the Chinese as similar to referring to continuing British administration. raise awkward questions about the status of Hong Kong as a colony in perpetuity and the distinction between Hong Kong and the New Territories.

Clause 3 giving continuing power to administer the New Territories is not as immediately essential as clause 2(i). Nevertheless it would be unwise to dispense with it, unless we have no alternative because:

prouide for continued Anturi adu iu usta hin при г99 ?. і ставить wiking's clear an

undicalen

til the maths of HK's fulue for

1997 and he texted

Caler

Flag D

Flag E

(i)

(ii)

without such a clause there could be legal wrangles about the right of the Hong Kong Government to allocate property rights after 1997. This might affect investment; and

such powers will, at some point, be necessary and it is as well to deal with this problem under the umbrella of the leases issue.

Alternative wording for clause 3 follows the same lines as para. 7(a) (e) above.

Conclusion on alternatives to clauses 2(i) and 3

9.

All of the alternatives suggested in para.7 have some disadvantages. None are as good as the wording of the present draft. Of the alternatives the least open to objection is (e). Unless we can devise some other alternative the choices lie between persevering with the present version or using some variant of (e). The FCO at one stage suggested the link with Hong Kong as a possibility (FCO telno 97, para.4, (38)). We then rejected it as likely to provoke argument about the difference in status between Hong Kong and the New Territories (Hong Kong telno 204, (40)). However,

given that Deng's remarks are on the record and constitute a potential minefield to be avoided if possible, (e) is worth considering and now has a slight edge over sticking rigidly to the present version.

SECRET

/The Saving

3.

A