TNAG-1167-FCO40-1447-Future-of-Hong-Kong-1982 — Page 144

1

63

SECRET

DSR 11C

HONG KONG:

Introduction

OPTIONS FOR ACTION TO DEAL WITH A SLIDE OF CONFIDENCE OR A CHINESE INITIATIVE ON THE FUTURE OF HONG KONG

'1. This paper considers possible action by HMG to meet

two contingencies:

a) a collapse of public and business confidence in Hong

b)

Kong;

readiness by the Chinese to discuss more concrete

ways of bolstering confidence.

It starts by looking at the Chinese attitude to the problem

and the actions which they might be prepared to take.

/

It then considers joint actions and unilateral actions on

the British side with tacit Chinese concurrence. In each

case the likelihood of the action being taken, its effects,

and residual problems are considered. briefly.

2.