(ii)
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5.
(b) Para 10.
(c)
Annex B:
(a)
(b)
The NCNA have acted as the unofficial channel of communication since 1949 but with increasing openness and effectiveness since 1972. Regular contact between the Governor and the senior Director of NCNA dates from 1978. In 1978 the Chinese sent their most senior official to date, equivalent in rank to a Vice Minister, to be First Director. Contact between the NCNA and the Political Adviser's office now covers all issues. In all but name and
formal privileges the NCNA acts, and is treated by the Hong Kong Government, as the official representative of China.
Para 11. Worth pointing out that the Visa Office has not yet opened because of our unwillingness to meet Chinese demands for formal diplomatic privileges, not because of any disagreement about the functions of the office.
UK/Hong Kong Economic Relations
General. It is not possible to quantify accurately the economic advantage or other- wise of Hong Kong to the UK. But the draft annex is more down-beat in its general tone than is, I believe, justified.
The following are more specific points:
(i)
(ii)
The paper should place trade with Hong Kong in its regional context. Hong Kong trade may amount to only 1-2% of total UK trade. But, in Asia, Hong Kong is Britain's second largest market (after Japan). UK exports to Hong Kong in 1980 (5559 m.) were as great as to India (529 m.) almost as much as to Japan (5597 m.) and over three times as much as to China (169 m.). Furthermore, there is great potential for increase because Hong Kong is an expanding economy and it is in the centre of the most rapidly growing economic region in the world.
Para 5.
The UK derives very considerable benefit (not just "some") from the present relationship with Hong Kong. Besides Government contracts, the wide range of
connections between the UK and Hong Kong, resulting from the historical and present relationship, undoubtedly
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/contd..
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