TNAG-1040-FCO40-1290-Future-of-Hong-Kong-1981 — Page 106

in its latest statements.

DECRET

-2-

On the question of further arms

supplies for Taiwan after a settlement a Chinese official

said in the course of a private conversation in August that

these would be 'negotiable' but another Peking official told

a Japanese press correspondent in October that these would

not be permitted.

4.

The analogy between China's position on Taiwan and that

on Hong Kong was drawn by Deng Xiaoping in conversation

with the Governor in March 1979. He said that the UK would

be aware of China's policy on Taiwan;

that on its return

to China there would be 'no change in the social system,

nor would living standards be affected. Taiwan could still

enjoy a special status and local autonomy and even her own

armed forces, even though she would be part of China.

There could never be two Chinas or one and a half Chinas.

This was the Chinese position on Hong Kong and Macao as well

as on Taiwan. This was a long-standing policy. They had

adopted it because they needed Hong Kong'.

5. In his talk with Lord Carrington in April 1981, Deng

repeated these observations on Taiwan, adding that 'it

would be necessary for Taiwan to abandon the name by which

it called itself as well as its flag. This was a long-term

policy and not a matter of expediency. It also reflected

Deng'

China's policy towards problems of a similar nature'.

6. To the Chinese, Hong Kong and Taiwan are problems of

terra irredenta that could not be viewed in isolation.

references to an unchanged way of life and political system

could imply acceptance of a continuing degree of British

administration in Hong Kong, though within the framework of

a UK recognition of China's sovereignty,.

SECRET

; although