TNAG-0850-FCO40-1060-Future-of-Hong-Kong-New-Territories-leases-1979 — Page 118

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TO PRIORITY FOREIGN AND COMMONWEALTH OFFICE...

TELEGRAM NUMBER 1347 OF 27 SEPTEMBER, 1979

INFO PRIORITY PEKING.

nga

YOUR TELNO 773: NEW TERRITORIES LEASES.

1. SHOULD THERE BE A LEAK ABOUT THESE EXCHANGES IT WILL PROBABLY BE IN A GRABLED FORM. THIS MAKES IT DIFFICULT TO WORK OUT IN ADVANCE PRECISELY HOW TO RESPOND. NEVERTHELESS, HOWEVER THE MATTER COMES UP, I THINK OUR AIMS MUST BE TO SAY AS LITTLE AS POSSIBLE AND ALSO TO AVOID GIVING THE IMPRESSION TO OVER-SUSPICIOUS

MINDS THAT WE REGULARLY DISCUSS WITH THE CHINESE THE SUBJECT OF HONG KONG'S FUTURE. THE FIRST SENTENCE OF YOUR PROPOSED LINE

CARRIES SOME RISK OF THE LATTER.

2. APART FROM LEAKS WE MUST ALSO TAKE ACCOUNT OF THE POSSIBILITY OF PERFECTLY INNOCENT QUESTIONS ABOUT THE SHORTENING TERM OF LEASES IN THE NEW TERRITORIES WHICH INCREASINGLY WILL BE SEEN BY JOURNALISTS AS WELL AS BUSINESSMEN AS AN OBSTACLE TO ECONOMIC DEVELOPMENT.

3. TO COVER BOTH THESE POSSIBILITIES I SUGGEST THAT WE SHOULD ADOPT THE FOLLOWING GENERAL APPROACH:-

Q. HAVE YOU DISCUSSED WITH THE CHINESE THE QUESTION OF LEASES

IN THE NEW TERRITORIES?

A. WE DISCUSS A NUMBER OF PRACTICAL MATTERS AFFECTING HONG KONG WITH

THE CHINESE AUTHORITIES. AS WITH ALL SUCH DIPLOMATIC EXCHANGES THE CONTENT OF THESE DISCUSSIONS IS KEPT CONFIDENTIAL.

Q. HAVE YOU DISCUSSED WITH THE CHINESE WHAT HAPPENS WHEN THE NEW

TERRITORIES' LEASE EXPIRES?

A. AS MR BLAKER SAID IN HONG KONG ON 25 SEPTEMBER, THIS IS A

MATTER FOR THE FUTURE.

Q. IS NOT THE ABSENCE OF A SOLUTION TO THE PROBLEM OF LEASES IN

THE NEW TERRITORIES (THE NEW TERRITORIES' LEASE) HAVING AN ADVERSE EFFECT ON THE ECONOMY?

A. IT IS CLEAR THAT MOST INVESTORS TAKE A POSITIVE VIEW OF THE

PROSPECTS IN HONG KONG. IT IS TOO EARLY TO SOLVE PROBLEMS OF THE LONG-TERM FUTURE. THE IMPORTANT POINT AT PRESENT IS THAT BOTH BRITAIN AND CHINA CLEARLY HAVE A MUTUAL INTEREST IN

HONG KONG'S PROSPERITY AND STABILITY.

MACLEHOSE

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