TNAG-1650-FCO40-2297-Hongkong-and-Shanghai-Banking-Corporation-(HSBC)-1987 — Page 13

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some reports in the UK press (unlike the more sensible

coverage

in Hong Kong) have portrayed the acquisition as a prelude to a

merger or even as the first stage of a move out of Hong Kong. We

therefore think it almost certain that the Chinese will raise

this aspect and that defensive point (vi) will therefore need be

deployed.

4.

Please report by deskby telegram to us and to Peking as

soon as you have taken action. Provided Purves says nothing which would materially affect the line set out in MIFT, Sir R

Evans should take action with Ke as soon as possible. If Purves offers additional supporting arguments which you judge it would be useful for Sir R Evans to include, we would be content for Sir

R Evans to use his discretion to incorporate such points in

speaking to Ke.

5.

See MIFT.

HOWE

YYYY

PS

PS/LORD GLENARTHUR

PS/PUS

MR GILLMORE

MR MCLAREN

ADDITIONAL

MR LOEHNIS, BANK OF ENGLAND

30 MR KELLY, TREASURY

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