TNAG-1260-FCO40-1600-Briefings-for-Ministers-and-FCO-officials-on-the-future-of-H-1983 — Page 59

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continue to be internationally tradable, this will just happen.

Hong Kong people and investors need proof of effective guarantees

against Chinese interference.

7. Evidence suggests Chinese do not fully understand how Hong Kong

works. We have sought to educate them about complexities of its systems and basis for confidence, particularly in the Hong Kong dollar. We see link to Britain and systems prevailing as providing

best guarantee.

8. Central issue is to devise package in which Hong Kong people

will have confidence. Must therefore agree arrangements which will

reassure them. Given joint Sino-British aim, confident such an

arrangement can be worked out.

9. British Government obtains no revenue from Hong Kong other than

that of normal trading partner, contrary to what Chinese seem to

think.

10.

Important nothing said or done to damage confidence in Hong

Kong. Grateful for your understanding.

Sovereignty

11. Chinese and British positions well-known. We fully realise importance of sovereignty issue to China. We are not inflexible. Are willing to consider any solution to Hong Kong's future

acceptable to Britain, China and Hong Kong.

SPODER.