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to the Governor, the former's policy was first that whatever
was done to solve the problem the position of investors should
be guaranteed; secondly, that special policies should be adopted
towards Hong Kong to allow Hong Kong to continue as a capitalist
society. On the question of leases, he accepted that it was
indeed high time to consider what should be done after the next
17 years had expired, but the time was not yet ripe to make a
presentation of concrete proposals. But the Chinese Government
would find a solution. If they did not, they would not be able
to face the Chinese people or explain the situation to world
opinion.
But the solution must be in accordance with the principles
laid down by Vice Premier Deng.
Chinese Development Projects in Guangdong and Investments in Hong Kong
11.
Meanwhile, the Chinese authorities have continued moves
which are part of the Four Modernisations Programme but which
clearly have significance for the future of Hong Kong. In the
first place there are the 'Special Zones' established just north
of Hong Kong. The Chinese authorities may hope that eventually
they will match Hong Kong to the extent that the latter can itself
convincingly be represented as a special zone; indeed, the
Governor of Guangdong Province, Mr Xi Dongzhun, recently referred
to Macao and Hong Kong as special zones.
12. Chinese State Trading Organisations have also stepped up their
capital investment in Hong Kong itself. An important development
is the purchase of a 1,200 acre site in Tin Shui Wai in the New
Territories by a consortium of which China Resources owns 51%
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