TNAG-1338-FCO40-1770-Visit-by-Margaret-Thatcher--UK-Prime-Minister--to-Beijing-fo-1984 — Page 108

ADV CE COPIES

HONG KONG AGREEMENT

PS (2)

PS/MR LUCE

PS/PUS

DR WILSON SIR W HARDING,

HD/ HKD (3)

12

IMMEDIATE

SIR P CRADOCK

MR BURROWS, LEGAL ADVISERS

MR ROBERTS, NEWS DEPT

ADVANCE COPY

HD/ FED

SECRET

DESKBY 16090OZ

FM HONG KONG 160825Z NOV 84

TO IMMEDIATE F C O

TELEGRAM NUMBER 3500 OF 16 NOVEMBER

INFO PRIORITY PEKING

IMMEDIATE

HONG KONG AGREEMENT

1. I UNDERSTAND THAT CONSIDERATION IS BEING GIVEN IN LONDON TO WHETHER A PARTY OF BUSINESSMEN, AND IN PARTICULAR FROM GEC, SHOULD ACCOMPANY THE PRIME MINISTER ON HER VISIT TO SIGN THE HONG KONG

AGREEMENT.

2. AS I HAVE EXPLAINED IN EARLIER TELEGRAMS I CAN WELL UNDERSTAND THAT THE PRIME MINISTER WILL WISH TO TAKE THE OPPORTUNITY OF HER DISCUSSIONS IN PEKING TO PROMOTE SINO/BRITISH RELATIONS GENERALLY AND SINO/BRITISH TRADE IN PARTICULAR. BUT AGAINST THAT HAS TO BE BALANCED THE NEED TO AVOID CREATING THE IMPRESSION HERE THAT THE PROMOTION OF UK COMMERCIAL AND ECONOMIC INTERESTS WAS AN IMPORTANT FACTOR LYING BEHIND HMG'S DETERMINATION TO REACH AN AGREEMENT WITH THE CHINESE ON THE FUTURE OF HONG KONG. TO TAKE A PARTY OF SENIOR UK BUSINESSMEN, WHO WOULD INEVITABLY FEATURE PROMINENTLY IN THE MEDIA COVERAGE RELAYED BACK TO HONG KONG, WOULD IN MY VIEW RUN A SERIOUS RISK OF CREATING THE VERY IMPRESSION WHICH WE HAVE BEEN SUCCESSFUL IN AVOIDING SO FAR.

3. I UNDERSTAND THAT THERE IS ALSO A SUGGESTION THAT THE VISIT SHOULD BE USED TO BRING TO A CONCLUSION OR SIGNATURE SOME ASPECTS OF THE GUANGDONG NUCLEAR PROJECT, EG THE FORMATION OF THE JOINT VENTURE COMPANY. I WOULD RECOMMEND STRONGLY AGAINST PLANNING ON THIS BASIS. IT WOULD INEVITABLY BE INTERPRETED AS USING THE HONG ACDEEMENT AS A LEVER TO GAIN THE CONTRACT FOR GEC. AGAIN AS

VOSIC