TNAG-1254-FCO40-1587-Third-countries-and-the-future-of-Hong-Kong-1983 — Page 135

SUMMARY

THE UNITED STATES AND HONG KONG'S FUTURE: IMPORTANT INTERESTS, LIMITED OPTIONS 1/

American officials, business executives and investors have a strong

interest in the current negotiations between Great Britain and the People's

Republic of China (PRC) regarding the future status of Hong Kong. Prompted

by a legal deadline whereby 89 percent of the colony's territory will re-

vert to PRC rule by 1997, British and Chinese representatives began secret

discussions following Prime Minister Margaret Thatcher's visit to China in

September 1982 in order to determine how soon and in what ways China would

assert its claim to sovereignty over the territory. The start of the talks

was accompanied by sharp Sino-British disagreement over Hong Kong's current

legal status and implied PRC warnings that China might assert control over

the territory well before 1997. It also coincided with a serious decline

in the territory's economy, prompted in part by worries in Hong Kong over

possible future PRC rule. In recent months there have been same signs of

economic rebound, and a new round of Sino-British talks on Hong Kong began

in July, 1983. But opinion remains divided as to whether or not the antic-

cipated growing PRC influence over Hong Kong would jeopardize the territory's

viability as a commercial center in East Asia.

1/

Sources for this report include weekly coverage of Hong Kong issues by the Far Eastern Economic Review and the Asian Wall Street Journal Weekly. Trade and investment figures are from the U.S.Department of Commerce, Foreign Economic Trends and Their Implications for the United States. Coverage of PRC comment is seen in Foreign Broadcast Information Service. Daily Report. China.

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