TNAG-1695-FCO40-2351-Future-of-Hong-Kong-nationality-1987 — Page 134

GRS 350

Confidential

HKD 3064

་

2 APR 1987

DESK OFFIC:

CONFIDENTIAL

FM TOKYO

TO DESKBY 210300Z DTI

TELNO OTTER 241

OF 21061OZ APRIL 87

AND TO IMMEDIATE FCO, WASHINGTON

YOUR TELEGRAM NUMBERS OTTER 232 AND 237:

INDEX

FA

22

Cible.

6-

wirken

mek

20/4

IND WIRELESB

1. YOU WILL NOW HAVE SEEN MY TELEGRAM NUMBER OTTER 239 OF 18 APRIL ABOUT THE STATEMENT IN CABINET, AND SUBSEQUENTLY TO THE PRESS,

ON 17 APRIL BY KARASAWA (JAPANESE MINISTER FOR POSTS AND

TELECOMMUNICATIONS) THAT THE MPT WOULD WELCOME A PROPOSAL BY 2KDD FOR THE LAYING OF A TRANSPACIFIC CABLE. THIS STATEMENT BY THE

RELEVANT JAPANESE MINISTER REPRESENTS A SUBSTANTIAL SHIFT IN

ATTITUDE WHERE IT COUNTS MOST AND IS VIRTUALLY A VOLTE FACE IN

POLITICAL TERMS.

2. THE WATANABE PROPOSALS AT THE BEGINNING OF APRIL (WHICH

APPARENTLY INVOLVED THE MERGING OF THE TWO CONSORTIA ON WHICH

KARASAWA'S OWN STATEMENT MAY BE PREDICATED) CONTAIN PROVISION

FOR C AND W TO HAVE A SEAT ON THE BOARD OF A 2KDD AND A FINANCIAL

SHARE IDENTICAL TO THE OTHER JAPANESE AND FOREIGN CORE COMPANIES.

ALL THREE POINTS WHICH ARE OF FUNDAMENTAL INTEREST TO C AND W HAVE THEREFORE BEEN ADDRESSED AND CONCEDED IN PRINCIPLE OR TACITLY

BY THE JAPANESE IN THE PAST THREE OR FOUR WEEKS.

3. ON TOP OF THIS THE DISSATISFACTION OF HMS WITH THE JAPANESE

HANDLING OF THE MATTER IN RECENT MONTHS AND THE THREAT THAT

WE WOULD TAKE RETALIATORY ACTION IF C AND W QUOTE DID NOT OBTAIN

A FAIR CRACK OF THE WHIP UNQUOTE WERE MADE CRYSTAL CLEAR TO THE

JAPANESE GOVERNMENT INCLUDING THE MINISTER OF POSTS AND

TELECOMMUNICATIONS AND THE FOREIGN MINISTER WHEN MR HOWARD WAS HERE EARLIER THIS MONTH. THE JAPANESE GOVERNMENT HAVE BEEN LEFT IN NO DOUBT WHATSOEVER THAT WHILE NOT ENGAGED IN COMMERCIAL NEGOTIAT-

IONS HMG IS FOLLOWING THESE NEGOTIATIONS CLOSELY AND IS LOOKING FOR A SATISFACTORY OUTCOME FROM THE BRITISH POINT OF VIEW.

4.

HMG'S POSITION IS THEREFORE WELL SET OUT AND UNDERSTOOD AND COMMERCIAL NEGOTIATIONS ARE BEING PURSUED BY THE COMPANIES INTENSIVELY. THE TALKS ALSO INCLUDE DISCUSSIONS BETWEEN C AND W

(SOLOMON) AND MPT, AOBUT WHICH C AND W HAVE NOT BEEN PREPARED TO

GIVE US ANY DETAILS.

Confidential

IS. IN 15.