TNAG-1171-FCO40-1452-Future-of-Hong-Kong-1982 — Page 79

GR 560

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04011

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FM HONG KONG 210653Z MAY 82

TO IMMEDIATE F C O

TELEGRAM NUMBER 529 OF 21 MAY

INFO IMMEDIATE PEKING (PERSONAL FOR AMBASSADOR) TOP COPY

PERSONAL FOR DONALD

(278

279

HONG KONG TELNOS 523 AND 5241 FUTURE OF HONG KONG

+

211.

1. FIRST SECRETARY AT AUSTRALIAN COMMISSION HAS NOW PROVIDED FURTHER BACKGROUND TO THE REPORT IN SECOND TUR. THIS IS SUMMARISED

IN PARAS 2 TO 6 BELOW.

See

22/3

304

2. THERE IS ALSO ONE IMPORTANT CORRECTION: POINT H SHOULD BE OMITTED

THESE REMARKS WERE NOT (NOT) MADE BY HUAN BUT WERE PART OF THE DFA'S COMMENTARY ON WHAT HE SAID (NOT PASSED TO US). THERE WAS A MISTAKE IN THE ORIGINAL TELEGRAM AT THAT POINT.

3. HUAN'S REMARKS WERE MADE TO HIS DFA ESCORTING OFFICER, PETER

ROWE, A CHINESE LANGUAGE OFFICER WHO HAS SERVED IN PEKING AND IS NOW (OR WAS UNTIL RECENTLY) CHINA DESK OFFICER. THEY WERE MADE ON TWO SEPARATE OCCASIONS, THE SECOND OF WHICH PROVIDED OPPORTUNITIES TO CLARIFY REMARKS MADE ON THE FIRST. HUAN SPOKE OPENLY AND AT SOME LENGTH, DEALING WITH HONG KONG IN THE SAME MANNER AS HE DISCUSSED OTHER ASPECTS OF CHINESE POLICY.

4. THE INITIATIVE WAS TAKEN BY ROWE, NOT (NOT) HUAN. ROWE WAS

PROMPTED TO RAISE HONG KONG BY TWO TELEGRAMS RECEIVED FROM THE AUSTRALIAN AMBASSADOR IN PEKING REPORTING TWO SEPARATE CONVERSATIONS WITH HUAN. IN THE FIRST OF THESE CONVERSATIONS, SOME TIME BEFORE HIS DEPARTURE FROM PEKING, HUAN TOLD THE AMBASSADOR (PRESUMABLY IN

ANSWER TO A QUESTION) THAT HIS ACADEMY WAS MAKING A CAREFUL STUDY OF HONG KONG'S ECONOMIC IMPORTANCE TO CHINA. HUAN SAID HE DID

NOT KNOW HOW FAR THIS HAD PROGRESSED AND WAS NOT FAMILIAR WITH THE LINE OF THOUGHT BEING DEVELOPED BY THE ACADEMY. HE THEN MENTIONED THAT HE WOULD BE VISITING HONG KONG ON RETURN FROM AUSTRALIA. THE SECOND CONVERSATION TOOK PLACE ON THE DAY OF HUAN'S DEPARTURE. HUAN SAID THAT THE BRITISH GOVERNMENT HAD BEEN VERY KEEN FOR HIM TO VISIT HONG KONG AND TALK TO PEOPLE THERE. HE ADDED THAT IT WAS CLEAR THAT THE QUESTION OF THE EXPIRY OF THE LEASE IN 15 YEARS

NEEDED SERIOUS THOUGHT, BUT THAT BRITAIN AND CHINA WERE IN AGREEMENT ABOUT THE ECONOMIC IMPORTANCE OF HONG KONG. HE LEFT THE AMBASSADOR WITH THE IMPRESSION THAT HIS VISIT WAS RELATED TO THE ECONOMIC FUTURE OF HONG KONG, BUT DID NOT SAY SO SPECIFICALLY AND DID NOT SAY OR IMPLY THAT HE EXPECTED TO DISCUSS THE QUESTION OF THE LEASE (PORTER'S ACCOUNT OF THESE TWO TELEGRAMS WAS GIVEN

IN CONFIDENCE - PLEASE PROTECT).

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5. THE