CONFIDENTIAL
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had not decided on any firm course of action. The nine-
point proposals for the reunification of Taiwan with China
were possibly relevant.
6.
Mr. Charles YEUNG enquired on possible options
open to Hong Kong. The LPS reiterated that, as yet,
China's intentions were not clear. As regards the options
favoured by HMG; the LPS said the best possible option
would be no change in the present situation. However,
the recent visit and meetings simply marked another step
forward. It was significant that the Chinese themselves
i
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had raised the question of Hong Kong's future and had
indicated their appreciation of Hong Kong as a free port
and financial centre. Miss Lydia DUNN said she thought it
was important now to maintain pressure in order to maintain
progress towards a satisfactory solution. The LPS indicated
that he felt Hong Kong should participate in pressing the
issue, but it was not going to be solved overnight. When
Mrs. Thatcher visited Peking in September the issue would
again, inevitably, be discussed. But it would be positively
unhelpful to bank or solutions emerging from that meeting
or on any firm time-table at this juncture.
7.
The Governor confirmed that HMG's powers in the
NT would lapse when the lease expired in 1997. Any action
:
by HMG in the NT after that date would be ultra vires.
The Chinese had made it clear that they did not recognise
/P.6
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