TNAG-0944-FCO40-1163-Future-of-Hong-Kong-1980 — Page 87

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DSR 11C

SECRET

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Having put the matter to Peking once, they would not

need to be approached about subsequent requests for

long leases.

d) An alternative approach would be to issue periodic

leases which would roll forward on an annual basis

and have no termination bar except if required for

'public purposes'.

e) The leases issue was not immediately urgent. If there

were no signs of movement on the Chinese side we

could delay taking the initiative until the autumn

of 1981. Thereafter, we would have to initiate talks.

f) Whilst the Chinese might not make the same distinction

as we do between the long and short-term aspects of the

problem, we should avoid getting into a situation where

either side was taking up positions on a long-term

solution. We should build up towards the latter by

gradual steps through finding answers to the short-

term problems.

g) There would be a greater need for informal contact

with the Chinese over the future of Hong Kong in order

to 'improve their brief' on the subject.

h) Intermediaries might seek a role; they would need careful

guidance.

i) The Secretary of State would be bound to raise the

matter of confidence in Hong Kong with the Chinese

in view of earlier discussions but leases would not

be formally on the agenda and would be tackled under

the general heading of 'Hong Kong'.

SECRET

S4200(22454) DD.0332198 300M 7/79 GWB LTD.GP.870

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