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what was going to happen there. He had also just heard that Premier Ohira had died. Mr Ohira had been strongly against the Soviet Union. Others, such as Miki, Nakasone and Fukuda, were not so good on this. The problem of Hong Kong had to be considered from the international strategic point of view. All these events were interlinked. He was not trying to avoid the Governor's questions. All he could do was to reiterate what Vice Premier Deng had said about taking into consideration the interest of investors when a solution was found. China, did not want investors to suffer loss. 1.5 million sq.kms which the Russians had grabbed from China could be put aside, but there were a further 30,000 sq.kms which should be returned. All these matters would have to be considered together. China approved very much of the strong attitude towards the Soviet Union taken by Mrs Thatcher. Britain and China had a common interest in this problem. The solution to Hong Kong should be considered in this wider context. Nothing should be done which would endanger Sino-British relations. There should be of course a discusssion of concrete problems. He hoped that economic relations between Hong Kong and Guangdong would develop rapidly.
9. The Governor thanked Mr Liao for what he had said. He now appreciated better than a year ago the complex problems which were mixed up with the Hong Kong question, even though not directly connected with it. He therefore agreed that, while giving thought to the main issue, we should actually deal with concrete matters. We might find that by dealing with these concrete matters, and by a process of evolution, the main problem would be easier to solve. Furthermore, dealing with concrete and technical issues would gain time. (Mr Liao agreed.) In saying all this he was of course speaking personally and not on instructions.
10.
Mr Liao concluded by thanking the Governor for his visit. The two sides should continue to work together for better relations.
11. The meeting concluded by 11.30 am.
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