TNAG-0851-FCO40-1061-Future-of-Hong-Kong-New-Territories-leases-1979 — Page 78

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Claims

4.

Lord Carrington said another, and longstanding, bilateral

problem was claims. An outline list had been presented to the Chinese Government in April. This was not just a Governmental matter but also affected a large number of private individuals. He would be grateful for an indication of the Chinese Government's readiness to negotiate.

5. Huang Hua said that private claims had a long history. Great changes had taken place in the meantime. The Chinese side

wanted to investigate the problem. Other countries had

raised similar claims.

6.

As a general principle, the Chinese Government did not undertake to pay up on claims for securities issued by the Northern Warlord Government, or on Chiang Kai Shek's debts. Vice President Mondale had been told this during his recent visit to China, when he had raised the question of American Loans

to previous Chinese Governments. It would be pointless for the

-

United States to make payment on these a condition for new loans

to China. However, the Chinese Government would investigate, and intended to settle, some private British claims for assets such as real estate or personal effects. Vice Minister Zhang Wenjin noted that these claims represented assets unconnected with previous Chinese Governments. Another factor was the confiscation of Chinese property in Hong Kong by the British

Government. after China's liberation. The Chinese Government

regarded this as a sanctions measure, and had requisitioned

properties in China in retaliation. The Chinese Government could

be expected to raise claims of their own. After Liberation, all land in China had been nationalised without compensation.

Any

7. Lord Carrington thanked Huang Hua for his response. Chinese claims would be taken into consideration. The British

Government would not repudiate excessive debts accumulated by

the previous administration-such action would be criticised

by Britain's friends and allies, and her creditors. He recognised that the situation in China was different, but hoped that the Chinese Government would look at the question.

CONFIDENTIAL

/Hong Kong