TNAG-1236-FCO40-1549-Future-of-Hong-Kong-1983 — Page 20

GRS 260

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FROM PEKING 16065OZ MAR 23

TO IMMEDIATE FCO

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TELEGRAM NUMBER 239 OF 16/3/83

REPEATED FOR FOR INFO TO IMMEDIATE HONG KONG

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OW NO. 51

FUTURE OF HONG KONG:

ZHAO ZIYANG

SK

1^7 MAR 1983

my AF

Apreb

1. NCNA FOREIGN AGENCIES AND PRESS BULLETIN OF 15 MARCH CONTAINED A UPI REPORT OF A CALL BY RANALD MCDONALD, MANAGING DIRECTOR OF THE PARENT COMPANY OF THE MELBOURNE AGE, ON

ZHAO ZIYANG. THE REPORT CLAIMED THAT ZHAO HAD SAID THAT CHINA WOULD TAKE OVER HONG KONG IN 1997.

2. WE HAVE NOW LISTENED TO A TAPE RECORDING OF THE INTERVIEW. ZHAO IN FACT SAID ONLY THAT THE CHINESE POSITION ON THE FUTURE OF HONG KONG WAS WELL KNOWN: WHEN CONDITIONS WERE RIPE, CHINA WOULD RECOVER SOVEREIGNTY OVER THE ENTIRE AREA OF HONG KONG. AT THE SAME TIME, CHINA WOULD ADOPT FLEXIBLE POLICIES TO MAINTAIN THE STABILITY AND PROSPERITY OF HONG KONG. THE SOCIAL AND ECONOMIC SYSTEMS AND THE WAY OF LIFE IN HONG KONG WOULD REMAIN UNCHAGED. THE INTERESTS OF INVESTORS, INCLUDING FOREIGN INVESTORS, WOULD BE PRESERVED.

3. ZHAO ALSO SAID THAT CURRENT CONCERNS IN HONG KONG WERE EXAGGERATED. THERE HAD BEEN SOME FLUCTUATIONS IN HONG KONG BUT MUCH OF THIS HAD BEEN DUE TO THE WORLDWIDE ECONOMIC CRISIS. IN FACT THERE HAD BEEN AN INCREASE OF INCOMING INVESTMENT TO HONG KONG IN THE FOURTH QUARTER OF 1982.

COMMENT

4. ZHAO'S LINE WAS UNREMARKABLE. HE DID NOT EVEN MENTION THE 1997 DATE. EVEN IN SPITE OF THE UP! DISTORTION, HIS STATEMENT

HAS AROUNSED LITTLE INTEREST AMONG THE FOREIGN

CORRESPONDENTS HERE. CRADOCK

FUTURE OF HONG KONG

LIMITED

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PS/MR HURD

PS/LORD BELSTEAD

PS/PUS

SIR J BULLARD

MR GIFFARD

MR DONALD

COPIES TO

SIR I SINCLAIR

MR ROBERTS

LEGAL ADVISER

NEWS D

MR COLES

MR MARTIN

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