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that it must be intended by the Chinese as a clear
indication of their interest in the maintenance of
the status quo in Hong Kong.
3. Our view is that the project obviously has political
howerk
significance. We tend to agree with Jack Cater (his
do not telegram No 947 of 28 July) that the Chinese have this as
have
their prime motive. Of course they must be fully conscious
that if a bargain of this magnitude between Governments
were sealed it would be an important confidence-building
measure, but I think they see it as one among a number of
such developments.
4.
When looking at such questions as New Territories.
leases, a nuclear power station within China, even with joint ounceship
is as clearly
management arrangements running beyond 1997,
of less direct significance than would be a major project
in the New Territories themselves. In the long run the
most important point is likely to be the sale of Chinese
electricity to Hong Kong for foreign exchange.
This should
be an important additional argument for the continuing
independence of the Hong Kong Dollar and might perhaps
tend to persuade theChinese that they would do better to
allow a separate administration to continue in the
territory rather than to try and run it themselves as a
'special zone'.
5. I hope that it may be possible for you to discuss
this with Kadoorie and to try to get his ideas into
rather better proportion. There is an added argument
for doing this fairly soon since, as I told you, he is
showing signs of trying to get involved in the Secretary
of State's visit to Hong Kong and Peking.
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We probably
/cannot
15
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