TNAG-1253-FCO40-1586-Third-countries-and-the-future-of-Hong-Kong-1983 — Page 123

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THIS IS A COPY

THE ORIGINAL HAS BEEN RETAINED IN THE DEPARTMENT UNDER

SECTION 3 (4) OF THE PUBLIC RECORDS ACT 1958

VISIT OF THE SECRETARY OF STATE TO WASHINTON: 13-15 JULY 1983 FOR

TALKS WITH MR SHULTZ

FUTURE OF HONG KONG

POINTS TO MAKE

1. Have been keeping you informed. Understand the Prime Minister briefed Mr Bush in London earlier this month.

All very

confidential.

2. Progress in talks through diplomatic channels in Peking initially slow.

3. Agreement reached to begin second, more substantive phase on 12 July. Agenda agreed which does not concede the Chinese precondition on sovereignty. Governor to attend this session as part of British Delegation led by our Ambassador in Peking. Chinese delegation led by Vice Foreign Minister Yao Guang.

4.

Aim remains to seek a solution acceptable to Britain, China and people of Hong Kong. Useful to have, reached this stage. But progress will still be slow. Need to educate Chinese on how Hong Kong works.

6.

Confidence in Hong Kong fragile, but underlying strength in the economy. Premier Zhao's anodyne reference to Hong Kong (at 6th National People's Congress, 6 June) may reflect China's realisation

of need for confidence.

Hong Kong Department

30 June 1983

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