TNAG-1169-FCO40-1449-Future-of-Hong-Kong-1982 — Page 82

Mr Donald

PS/LPS

Miurants J134.

1600. Mariday

wafibution the my.

-

did nii löken

CONFIDENTIAL MOVERING SECRET (LPSitio def

*

H&GD

Mar 11/5

167

1374

A

attached

B

124

SIR Y K PAO'S CALL ON THE LORD PRIVY SEAL

1. Sir Y K Pao is calling on the Lord Privy Seal at 1500 hours on Thursday, 1 April. I attach a brief. FED concur. Mr Davies (FED) and I will attend.

2. Sir Y K was last in London in mid-March. On 12 March the Prime Minister named one of his ships and on 16 March he called on he Chancellor of the Exchequer and Lord Carrington. I attach a copy of the record of the latter call.

3. Sir M MacLehose has suggested to Sir Y K that he should rein back on the loan idea. This was something that had to be played long. I agree. He also points out, rightly, in my view, that if Peking is seriously considering applying to us for a soft loan and linking it to the future of Hong Kong there is plenty of time to consider our response and in any case this should not be handled through an intermediary like Sir Y K.

4.

Since there is very little new to say to Sir Y K since his call on the Secretary of State, I think the Lord Privy Seal should confine himself mainly to listening and to saying he has nothing to add to what has already been said by the Secretary of State and the Chancellor.

31 March 1982

сс

Private Secretary

Mr Giffard

Mr Davies, FED

Вир

CONFIDENTIAL

R D Clift

Hong Kong and General Department

I

agree with

the advice. Sui YK

Pao is quite unscrupulous and it is

never

quite clear

clear what is his own

(? wishful) thinking and what is accurate reflection of

COVERING SECRET

The

an

vrais of the Chinese leaders. I

fear he wier

go on about

The inertation to Gu Mu!

Artmard

31/3