TNAG-1309-FCO40-1666-Future-of-Hong-Kong-1984 — Page 57

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historical and geographical situation, notably the expiry of the lease on 92% of the territory in 1997. We cannot escape the significance of 1997. Although the Chinese de regard the three

treaties covering Hong Kong, as unequal, they treat 1997 as a

political deadline.

8.

Chinese plan is for Hong Kong to become Special Administrative

Region of China after 1997 with a high degree of autonomy. It is a

matter of absolute principle for them that both sovereignty and

right of administration must revert to China then. Chinese views

and the legal reality of lease makes it necessary to consider what

alternative arrangement, other than continued British

administration, might assure continuity.

We are therefore holding detailed discussions with the Chinese

on the basis of their proposals for Hong Kong but without prejudice

9.

to our own position or to content of final agreement. Object is to

see whether arrangements can be made which would be sufficiently binding and contain sufficient assurances of autonomy and continuity.

10. We seek a binding agreement under which Hong Kong would remain basically unchanged for a period of 50 years. Legal, financial and social systems would be maintained in most respects. We need to build on the Chinese plan and to spell out as much as possible how this would affect every aspect of life.

But

11. No overall timetable agreed for talks. We, (like Chinese) want satisfactory settlement as soon as possible to end uncertainty. right solution more important than rushing. Chinese mention

September 1984 deadline. We take this into account but it does not

rule out a continuation of talks thereafter. Of course British Parliament has to be involved and give its approval to any

agreement.

12. In close touch with Hong Kong opinion. The Governor and EXCO officials visited London in January and again on 4-6 April for discussions prior to my visit to Peking. Aware of frustration in

Hong Kong at confidentiality of talks. But in due course Hong Kong

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