TNAG-1840-FCO40-2615-House-of-Commons-Select-Committee-on-Foreign-Affairs-enquiry-1989 — Page 23

Sino-British Land Commission, whose terms of reference are specified

in Annex III to the Joint Declaration, which deals with land leases.

The Commission has agreed that leases in the New Territories

referred to in that Annex should be extended to 2047. The New

Territories Leases (Extension) Ordinance gives effect to this

agreement.

The Commission is also charged with deciding whether the

annual limit of 50 hectares on land disposal specified in the Joint

Declaration should be exceeded. In practice the Commission has

exercised considerable flexibility and has agreed each year so far that the limit should be exceeded. The programme agreed for 1988/89 covered some 150 hectares. This includes substantial land grants

for the seventh container terminal and for the third university.

25.

Under the terms of the Joint Declaration, premium income from

land transactions, after deduction of the average cost of land reclamation, clearance and other related costs, is shared equally between the Hong Kong Government and the future SAR Government. (The Chinese side of the Land Commission manage their share of the income in trust, through a Hong Kong SAR Government Land Fund and an Investment Committee.) Almost HK$10 billion has so far been credited

to the account of the future SAR Government.

26.

Ministers have taken a close interest in the implementation of the Joint Declaration. The work of the JLG and other aspects of implementation have featured regularly in the Foreign Secretary's talks with his Chinese counterpart on nine occasions since 1985 and in other exchanges at Ministerial level.

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27. A key aspect of the implementation of the Joint Declaration is the drafting of the Basic Law. That is dealt with in Section XI of

this memorandum.

VIII:

28.

Development of representative government in Hong Kong

The system of government in Hong Kong has evolved in a way which has reflected the particular circumstances of the territory. In other British dependent territories our policy has been to promote the development of democracy as part of the preparations for eventual independence. There has however never been any question of