TNAG-1172-FCO40-1453-Future-of-Hong-Kong-1982 — Page 5

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In this day and age, it would be unrealistic to expect China to renew Treaties that she has always considered to be so obviously! unequal. The Government of the People's Republic of China has never recognized the Treaty of Nanking (1842) and all subsequent Conventions of Peking (1860 and 1898). China has already claimed? sovereignty over Kowloon and Ilong Kong. This claim has never been formally rejected by the British. Both sides regard Hong Kong as being part of China and presently under British management." When 1997 arrives, what is then going to happen to Hong Kong? The future of Hong Kong will depend, in part, on the local population. If we remain productive and can serve a unique economic function for [China and the world, I believe that a practical and sensible solution

could be reached by dialogue before 1997. This solution should, given good will, be formulated more on the basis of mutual economic interest rather than military power, political ideology or even international law

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(Deng Xiaoping and other leaders in Beijing have stated repeatedly and ̈*,*

categorically that Hong Kong should remain a free port and that its usefulness be preserved. Lord Carrington, at a press conference in Hong Kong on 31st March 1981, upon his return from China, was

reported to have said, "First of all, British relations with China have

never been better than they are now; secondly the Chinese made it abundantly plain that they want a stable and prosperous Hong Kong and thirdly, it's clear for all to see wherever they are, that the stability and prosperity of Hong Kong is a common interest shared by Britain, Hong Kong and China,". One can now see that there is already a general agreement among the interested parties concerning* the future of Hong Kong! The most important feature is to perpetuate Hong Kong's independent economic status so that it can serve as one of the financial centres of the world where modern technology and

know-how can be transferred into China. In order to do so, laws

and commercial practices in their present forms must continue and the Hong Kong dollar must remain freely convertible.

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Shanghai, which is at the mouth of the Yangtze River, was historically the most important Chinese centre for foreign trade. Will Shanghai eventually replace Hong Kong as the gateway of China? At the present time, we have excellent facilities in transportation and communication. With the absence of foreign exchange control and very low taxation, Hong Kong is also one of the important centres for capital formation. A great deal can be done to help China's modernization programme from Hong Kong through the adjacent Guangdong Province right now. When Lord MacLehose visited our neighbouring city, Macau, he urged businessmen to look North to

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