TNAG-1313-FCO40-1688-Future-of-Hong-Kong-views-and-involvement-of-Australia--Cana-1984 — Page 136

Mr

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26

BRITISH HIGH COMMISSIJA

CANBERRA

27 September 1984

MKK040/6

RECEIVED IN REGISTRY!

- 2 OCT 1984

DESK OFFICER INDEX

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Mr R White AO

Chairman

Business Council of Australia

27th Floor

60 Martin Place

home a

SYDNEY

NSW 2000

ZAI

10/10 GR 14/001

157

I write to draw to your attention, and I hope, through you, that of your colleagues, the agreement between the Chinese and the British Governments on the future of Hong Kong which was initialled in Peking on 26 September. The British Government is well satisfied with the terms of the agreement and you may have seen that Mr Hawke has issued a statement commending it.

I thought that you might find the following brief account of the background of interest. The agreement represents the culmination of two years of intensive negotiations which began with Mrs Thatcher's visit to Peking in September 1982. In view of the fact that the lease over the New Territories, which comprise 92% of Hong Kong's land area, is due to expire in July 1997, and the remaining 8% will not be viable on its own, the British Government decided to enter into negotiations with the Chinese Government over Hong Kong's future. During the course of these negotiations the British Government sought to examine ways in which Hong Kong's continuing stability and prosperity, the agreed common aim of the negotiations, could be maintained. The present agreement has been constructed on the basis of Chinese ideas for Hong Kong as a special administrative region of the People's Republic of China, enjoying considerable autonomy and functioning essentially as now. We believe that this represents the best possible framework within which Hong Kong's continuing stability and. prosperity can be maintained.

The document is an unequivocally binding international agreement. We believe that it contains sufficient detail and clarity about the systems and arrangements which will prevail in Hong Kong after 1997 to command the confidence both of the people of Hong Kong and of the international community. It contains provisions that its terms will be stipulated in a basic law of the Hong Kong special administrative region of the PRC, to be passed by the National People's Congress of China. This basic law will in effect form the Constitution of Hong Kong from 1997.

I would like to emphasise in particular that the agreement provides for a high degree of autonomy for the future special administrative region in the fields of the economy, finance,

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