TNAG-1037-FCO40-1287-Future-of-Hong-Kong-1981 — Page 53

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Government would take a similar view and would not favour the idea of

a representative of the Guangdong Provincial Government.

However,

even the straight formalisation of Chinese Government representation

in Hong Kong would be regarded as of considerable significance

by public opinion in the Territory. Taken on its own, it could be

seen as a move towards an agreement with China. Damage to confidence

would depend on the context in which the move was set, whether

significant concessions had been made by the Chinese in return and

what the Chinese said about it. In any event it would be essential

to agree a definition of the representative's functions, and avoid

the position of having 'two Governors' (see record of Sir Alec

Douglas-Home's meeting with Zhou Enlai in 1972). If the matter came

up during the next 5 years, this would probably mean in practice

moves on our part to reassure investors and in particular to overcome

the difficulty over individual land leases. We would need to use

a concession over a Chinese representative to obtain as concrete

undertakings as possible from the Chinese on these points. These

should go beyond the general assurances which Chinese leaders have

given so far. We would need at least an arrangement whereby

Peking agreed that the Hong Kong Government would in future issue

standard leases of a definite duration, say 25 years, and that Peking

recognised their validity. In this case we would still need to

overcome the problem of whether such leases were valid under British

law (which in practice would require amendment of the 1898 Order in

Council).

Chinese Participation in Hong Kong Administration

21. The range of possible demands is given in paragraph 12(c) above.

The more extreme proposals, such as membership of the Executive

and/or Legislative Councils, are very unlikely to be made by the

Chinese, who would themselves not wish to upset confidence, and would

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