TNAG-1482-FCO40-2036-Economic-and-commercial-value-of-Hong-Kong-to-the-UK-1986 — Page 21

From: THE PRIVATE SECRETARY

CONFIDENTIAL

Dear Charles

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HOME OFFICE

QUEEN ANNE'S GATE

LONDON SWIH 9AT

27 June 1986

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Car 101/2

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3402

PECEIV

3 1JUL 1986

IN 24.

The Home Secretary and the Foreign Secretary have been considering again the suggestion from Sir Michael Sandberg that British citizenship should be granted to certain wealthy business- men in Hong Kong in return for investment here. Your letter of 18 March reported the Prime Minister's views; and Colin Budd's letter of 1 April recorded that the Foreign Secretary had suggested a decision should be left over until after the Governor had assessed reaction in Hong Kong to the Nationality Order. The Governor has now reported.

The Home Secretary recognises the strength of the points which the Prime Minister has made. He would be reluctant to pass up the opportunity of encouraging investment in this country. But at the same time he would not wish to undermine the Government's nationality policy, which is based on British citizenship reflecting a person's personal links with this country. Nor, as the Prime Minister has said, would we wish to undermine confidence in the future of Hong Kong. This could well be the effect if we were seen to be offering a refuge from future uncertainties to a few particularly wealthy individuals.

The reaction in Hong Kong is, of course, crucial. The assessment of the Governor of Hong Kong is categorical. He has concluded, especially in the light of the Government's decision not to grant British citizenship to the ethnic minorities, that to grant British citizenship to wealthy businessmen would cause an outcry in Hong Kong and be politically unacceptable there. (It would in practice be impossible to keep such a decision confidential). In the Governor's view,

In the Governor's view, following the Government's decision on the ethnic minorities, Hong Kong opinion would conclude that an individual's wealth was of more importance than his personal qualities or than any moral obligation to the ethnic minorities. No mitigating factors relating to investment in the United Kingdom or Hong Kong would carry any weight against these objections. As the Governor has pointed out, we could not easily confine the offer to Chinese businessmen only there are also Indian businessmen who might be equally willing to invest here in return for British citizenship and to grant them British citizen- ship would only stir up further the controversy about the treatment of other members of the ethnic minorities.

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CONFIDENTIAL