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Chinese had only an incomplete grasp of such components, eg, the working of the legal system. Moreover he found it difficult to imagine how, as a communist regime, the Chinese could manage capitalist Hong Kong. Many practical and social problems would ensue. It was unlikely that China's modernisation programmes would proceed swiftly enough to cushion such difficulties effectively.
4. Mr Luce said that in general, our relations with China were good. Lord Shawcross agreed and said that Hong Kong was the only area of difficulty. Mr Luce reiterated the consequent need to educate the Chinese about the components of Hong Kong's stability and prosperity. Anything that prominent personalities, such as Lord Shawcross could do in this respect, would be welcomed.
5. Lord Shawcross said that he would try to put across appropriate points as opportunities arose. In the immediate future he would be meeting officials of the Bank of China here. He would explain to them the basis of Hong Kong's success as a financial/commercial centre. He did not know, however, if this information would be passed on in China at a high political level. In general, it was difficult for him to get access to Chinese political leaders, though a few months ago he had spoken in China to an Assistant Foreign Minister dealing with the Hong Kong problem (Zhou Nan).
6. Lord Shawcross said that he had floated the idea of 'internationalising' Hong Kong's Executive Council in an autonomous Hong Kong. American and Japanese investment in Hong Kong was now far greater than Britain's and he thought it both realistic and sensible to envisage American, Japanese and European appointees of Peking helping the Chinese to administer Hong Kong. An arrangement of this sort would do much to boost confidence in the future viability of the territory.
7. Mr Luce underlined the importance of ensuring that any arrangements for the future of Hong Kong would be acceptable to its people. Lord Shawcross understood this. In particular, he realised that Hong Kong's professional and managerial classes were essential to the territory's well being. Although many of them would remain in Hong Kong others would undoubtedly leave because of uncertainty
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