TNAG-1167-FCO40-1447-Future-of-Hong-Kong-1982 — Page 159

DSR 11C

SECRET

-3-

however be little doubt that the Chinese would have great

political difficulty over a statement formally accepting continued British administration.) The Chinese appear to

favour an agreement of this kind for Hong Kong primarily

because they calculate that this would preserve for them

the major advantages which they derive from the

Territory. In addition, they might see an agreement on

these. lines with respect to Hong Kong as setting a useful

example which would increase the pressure on the Taiwan

authorities to respond to their overtures.

SECRET