TNAG-1041-FCO40-1291-Future-of-Hong-Kong-1981 — Page 108

4.

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-2-

DSR 11C

We need to decide soon on tactics for discussion with

the Chinese because:

5.

a) if no action is taken, concern in Hong Kong will

probably come to a head by 1985, possibly even by

1982;

b) the Prime Minister has agreed in principle to visit

China, probably in September 1982. The Hong Kong

The visit would raise question could not be avoided.

expectations of a solution, which might not be

realised.

Among the options in the paper the most likely starters

are either:

a) a Chinese public undertaking to give long-term notice

(say 15 years) of change in the status of the

Territory); or

b) statements by the UK and China that Hong Kong is

Chinese territory temporarily under British

administration and that no change is intended

for many years to come.

The Chinese may not be ready to bargain.

If they were,

the price for option (a) would almost certainly be

renunciation of sovereignty by HMG. Option (b) also amounts

to technical renunciation of sovereignty. Judging by our

contacts with the Chinese and their recent statements on

Taiwan, we are unlikely to reach agreement without this

concession.

Moreover, the status of the New Territories will

in any event require adjustment in 1997 and without them

Hong Kong would not be viable.

6. Our aim in being prepared to bargain on sovereignty

would be to obtain well before 1997 an assurance that

a separate British-administered Hong Kong would continue

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/after