TNAG-1154-FCO40-1434-Visits-by-Members-of-Parliament-(MPs)-to-Hong-Kong-1982 — Page 282

PERSONAL AND CONFIDENTIAL

2

visit to the area this September. We are well aware that

concern about the future is growing in Hong Kong itself and

we have made clear that the interests of the people there

will of course be taken into account.

Thus, although both sides are looking seriously and

constructively at the problem, all the options are being kept

open and no-one is expecting any rapid or sudden developments.

Our main interest at this stage is to ensure that the Chinese

leadership understand the importance of maintaining confidence

in Hong Kong and of reassuring people there, more specifically

than they have so far done, that major changes will be avoided.

This is as much in their interest as in Hong Kong's since, as you know, they earn about 40% of their foreign exchange from Hong Kong, much of it in the independent Hong Kong dollar. But it would be unfortunate at this stage to give any impression, as some newspapers have, that the Prime Minister's visit is likely to produce the solution to the problem. Of

course the subject is bound to come up during her visit and we shall hope to make some progress but in the meantime we

must tread carefully. I think it would be helpful,

therefore, if when the subject comes up, particularly with the media, you felt able to stick generally to the line we have

taken in public so far. I am sure you will be in touch with our Ambassador in Peking, Sir Percy Cradock, and with the

Governor in Hong Kong, Sir Murray MacLehose.

Both will,

I know, be very ready to help.

/I hope you

PERSONAL AND CONFIDENTIAL