TNAG-1167-FCO40-1447-Future-of-Hong-Kong-1982 — Page 166

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CONFIDENTIAL

+ Plans 17/2

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HONG KONG STOCK EXCHANGE

1.

The Hang Seng Index of the Hong Kong Stock Exchange fell dramatically yesterday by 43 points to 1,322. The fall was attributed to local press reports that the Chinese Government will treat the New Territories as a Special Economic Zone, similar to the one in Shenzhen just over the border, after 1997 with the British Government acting as manager for the District.

2.

The interesting thing about this is not so much the report but the Stock Exchange reaction. The Hong Kong press has in recent months been full of stories about the future of Hong Kong. This is however the first time that one has noticeably affected the Exchange.

3.

We have asked Hong Kong for a report.

9 February 1982

Jwilliamon

ито

P J Williamson

Hong Kong and General Department K242 233 4439

CONFIDENTIAL