TNAG-1871-FCO40-2659-Relations-between-Hong-Kong-and-China-1989 — Page 6

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MARTIN LEES: CHINA AND THE WORLD IN THE NINETIES

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1.

As you requested I called Martin Lees at his hotel on. Friday. He said he would not have time to call in at the Embassy this trip, but simply wanted to keep us informed of what was happening. He would be back at the end of April and hoped to have more time to call in then.

2.

I attach papers you passed to me. Mr Lees is organising two conferences this year as a follow-up to the one held last year:

3.

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Banking and Finance. He expected there to be 12 - 15 foreign participants, including, he hoped, Lord Barber and Kit MacMahon. There was also a possibility that John Read of Citicorp and John Whitehead, formerly head of Goldman- Sachs, would also participate.

Foreign Investment. For this Mr Lees hoped to be able to persuade Eric Sharpe and Dennis Henderson of ICI to attend. He asked if I had any suggestions. I said that Jardine Mathieson and Inchcape of course had a long history of dealing with China, and added jokingly that GEC were active. He seemed rather tickled by the latter idea and may well try to persuade Arnold Weinstock to participate.

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Mr Lees also said that he expected Hong Kong to be raised during the discussions. He said that at last year's meetings Deng Xiaoping had talked about Hong Kong with Lord Barber who had later reported to HMA and to FED in London. Mr Lees said he wanted Lord Barber to participate again because of his close relationship with the Prime Minister. The Chinese were very interested specifically in how their own banking system compares with that of Hong Kong, and more generally in what could be done to ensure that 'someone was still left in Hong Kong' when they took over. He said this would be a good opportunity if the Foreign Office wanted to pass over some message. I stressed to Mr Lees that there were already well established channels for discussing all aspects of Hong Kong and that the Chinese as far as I knew resisted attempts to go outside these channels. You should be aware, however, that he expects Hong Kong to be discussed in a quasi-official way. He said he planned to call on Dick Clift on his way home and I urged him to keep FED informed.

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6 March 1989

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Peter Wood