SECRET
FCD
Subsequent information from secret and other
sources (e.g. Wang Kuang to Sir M M;
cources[(e.g.
Zhao to Fung King Hey; Huan to Australians;
Hu to party cadres) tends to confirm this line
of thinking.
7.
Current Chinese attitude. Politically
logical. Reflects strong pressures within
party not to make concessions to colonial
administration . But Hong Kong's absorption
as an autonomous zone would not retain
K
confidence. $ would shump-
8.
Economic considerations must still be strong;
The question is whether they are fully understood
and weigh sufficiently with the Chinese to
enable a deal involving recognition of their
sovereignty in return for practicable
continuation of British adminstration. Will
not be easy.
Tense. At least Chinese
likely to seek concessions on flags and important role for a new Chinese representative in
Hong Kong.
Have outlined a number of options. The most favourable to us would probably be an agreement of notice (15 years) by either side for change
of status quo.
Passed ħ PM by Lord
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