TNAG-1265-FCO40-1612-Future-of-Hong-Kong-despatch-on--The-Hong-Kong-Negotiations--1983 — Page 17

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surprisingly liberal, in essence the concept of a capitalist

system surviving in Hong Kong as an enclave in a surrounding

socialist economy. They do not recognise the vital defects of

their plan: that it lacks real guarantees or adequate detail;

and they are reluctant to admit that the history of China over

the last 30 years is bound to arouse deep suspicion of the

durability of any Peking assurances on the part of the inhabitants

of Hong Kong. They are convinced that their plan for Hong Kong will

be sufficient to preserve its prosperity, whatever the British may

say. At the decision-making levels they remain also deeply

ignorant of Hong Kong and suspicious of our motives: they continue

to believe that we extract revenue from Hong Kong; and that we

recently manipulated the fall in the Hong Kong dollar as a means

of bringing pressure on Peking. They find our declarations of our

moral responsibility to the people of Hong Kong baffling and

hypocritical; and they continue to think that in the end it is

British economic interests we are concerned about and that we can

be satisfied with some suitable commercial or financial quid pro quo.

11.

Deng himself is not only suspicious and ill-informed but

impatient. At 80 he realises he has little time left. He would

like to accomplish something Mao could not, the recovery of some

lost Chinese territory. Taiwan is for the present unattainable,

but Hong Kong is within reach; and particularly at the present time

when he faces internal opposition over Party rectification, he

needs tangible successes. We must accept that he will insist on

some announcement by the Chinese side in September 1984.

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8.

/12. The