DRAFT OD PAPER
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THIS DOCUMENT IS THE PROPERTY OF HER BRITANNIC MAJESTY'S GOVERNMENT
[Paper No]
[Date]
COPY NO
CABINET
DEFENCE AND OVERSEAS POLICY COMMITTEE
FUTURE OF HONG KONG: CONTINGENCY OPTIONS
Memorandum by the Secretary of State for Foreign
and Commonwealth Affairs
DSR 11C
1.
The attached paper outlines the problems for Her
Majesty's Government of uncertainty over Hong Kong's future
with the approaching end of the New Territories Lease.
The present, relatively pragmatic Chinese administration
probably favour a continuation of the status quo but are
unwilling to make any hasty move which might pre-judge the
final outcome for the Territory to their disadvantage.
Her Majesty's Government could also live with de facto
continuation of the present position were it not for the
legal problem that the basis of our administration of the
New Territories will expire in 1997. Meanwhile concern is
growing in Hong Kong about the future and confidence there
could slide quickly, possibly with a run on the Hong Kong
dollar and rapid withdrawl of investments. This would
create major problems for Her Majesty's Government in our
relations with China, over the credibility of our commitment
to the people of Hong Kong and domestically.
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