TNAG-1254-FCO40-1587-Third-countries-and-the-future-of-Hong-Kong-1983 — Page 19

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FINANCE CENTRE WOULD REMAIN UNCHANGED. THE HONG KONG DOLLAR WOULD CONTINUE TO CIRCULATE. IN A WORD CHINA HOPED THAT THE RECOVERY OF SOVEREIGNTY WOULD BE SHOOTH SAILING AND THAT SHE

WOULD BE ABLE TO MAINTAIN THE STABILITY AND PROSPERITY OF HONG

KONG. WU ALSO MENTIONED THAT DENG HAD TOLD SUZUKI DURING HIS

VISIT HERE THAT JAPANESE INTERESTS AND FIRMS WOULD NOT BE AFFECTED.

4. WU SAID THAT THREE MEETINGS HAD NOW BEEN HELD SINCE THE SECOND

PHASE OF THE TALKS BEGAN: BOTH SIDES HAD AGREED THAT THE CONTENTS SHOULD NOT BE MADE PUBLIC, AND CHINA WOULD ABIDE BY THIS. CHINA

HAD EXPRESSED THE HOPE THAT BRITAIN WOULD BE COOPERATIVE.

HOWEVER IF IN THE PERIOD UP TO 1997 A CHAOTIC SITUATION DEVELOPED AND GOUT OUT OF HAND CHINA WOULD RECONSIDER THE TIME AND MEANS OF RETAKING SOVEREIGNTY. CHINA DELIEVED THE BRITISH GOVERNMENT WOULD COOPERATE SO THAT THE ISSUE COULD BE RESOLVED.

5. WU SAID THAT THERE WERE SUME SIMILARITIES BETWEEN THE HONG KONG SITUATION AND TAIWAN. HE THEN DESCRIBED CHINESE POLICY TOWARDS TAIWAN IN FAMILIAR TERMS BASING HIMSELF ON THE 9 POINT PROPOSAL. HE ADDED THAT CHINA COULD MAKE NO CONCESSION IN TWO AREAS: TAIWAN COULD NOT HAVE TOTAL AUTONOMY BECAUSE THIS WAS WAS INCOMPATIBLE WITH NATIONAL UNITY, AND IN INTERNATIONAL AFFAIRS ONLY THE PRC COULD REPRESENT CHINA. WU ASSERTED THAT SENG IN SPEAKING IN JULY TO PROFESSOR YANG HAD NOT GONE BEYONG THE

ORIGINAL 3 FOINTS.

5. WU SAID THAT THERE WERE THOSE WHO QUESTIONED WHETHER TWO DIFFERENT SYSTEMS COULD EXIST SIDE BY SIDE WITHIN SOCIALIST CHINA, AND FRIENDS FROM HONG KONG HAD ASKED ABOUT THIS. PEOPLE THERE WERE WORRIED. TO REBUT THESE WORRIES HE CITED ARTICLE 31 OF THE CONSTITUTION. HE SAID THAT CHINA WOULD ESTABLISH TWO SPECIAL ADMINISTRATIVE REGIONS IN TAIWAN AND HONG KONG. AS TO HOW LONG THEY WOULD PERSIST HE PERSONALLY THOUGHT THAT TWO DECADES WOULD BE ENOUGH. CHINA WOULD HAVE MADE GREAT ECONOMIC PROGRESS BY THE YEAR 2000. HE THEN ADDED THAT 30 YEARS AFTER THAT THERE WOULD NOT BE SUCH GREAT ECONOMIC

DISPARITY.

7. HAYDEN PRESSED WU ON WHETHER HONG KONG WOULD CONTINUE TO BE A FREE MARKET AS IT WAS NOW, AND WHETHER THIS IMPLIED THAT THERE WOULD BE NO GOVERNMENT INTERVENTION ABOVE PRESENT LEVELS IN ECONOMIC AND FINANCIAL AFFAIRS, AND WARNED HIM THAT EVEN WHAT SEEMED TO BE SMALL INTERVENTIONS WOULD SEEM LIKE LARGE ONES TO BUSINESSMEN, WU AT FIRST EVADED THIS BY REPLYING SIMPLY THAT

2 SECRET

PHONG KONG