TNAG-1038-FCO40-1288-Future-of-Hong-Kong-1981 — Page 162

SECRET

As

strive to build on what Deng had said about Taiwan. one of the fall-back positions, we should also have to consider the implications of HMG's recognising China's ultimate sovereignty over Hong Kong and Kowloon (their ultimate sovereignty over the New Territories was already accepted in terms of interntional law).

4.

It was agreed that an outline paper on the

necessary contingency planning should be prepared soon, preferably by the end of May. Such a paper would then be considered and elaborated in good time for a possible visit to China in 1982 by the Prime Minister.

Political Adviser's Office, Hong Kong,

11 April, 1981.

SECRET

2.