TNAG-1967-FCO40-2799-Confidence-building-measures-for-Hong-Kong-1989 — Page 50

CONFIDENTIAL

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WE NOTICE THE ABSENCE OF ASEAN. ASEAN COUNTRIES ARE HONG KONG'S COMPETITORS AND WOULD NOT NECESSARILY BE SORRY TO SEE A DECLINE IN HONG KONG'S ECONOMY. BUT WE BELIEVE THAT THERE MAY WELL BE POLITICAL ARGUMENTS, BASED ON REGIONAL STABILITY AND THE PROMOTION OF A MORE OUTWARD-LOOKING AND PEACEFUL CHINA, WHICH COULD BE DEPLOYED TO PERSUADE THEM OF THE VALUE OF HONG KONG'S CONTINUED

STABILITY AND PROSPERITY AND ENCOURAGE THEM TO USE THEIR INFLUENCE

WITH THE CHINESE ACCORDINGLY. THIS WOULD BE PARTICULARLY TRUE OF OLD COMMONWEALTH MEMBERS WITH LARGE OVERSEAS CHINESE COMMUNITIES, E.G. MALAYSIA AND SINGAPORE. TO CEMENT RELATIONS WITH THESE AND

OTHER ASEAN COUNTRIES IT MAY WELL BE IN HONG KONG'S INTEREST TO LOOK INTO THE POSSIBILITY OF ECONOMIC, TECHNICAL AND OTHER FORMS OF COOPERATION WITH THEM.

5. TUR, QUITE RIGHTLY, DOES NOT INCLUDE TAIWAN AMONG THE TERRITORIES WITH WHICH HONG KONG SHOULD DEVELOP MORE POLITICALLY-

MOTIVATED CONTACTS. ALTHOUGH THERE MAY BE CONSIDERABLE ECONOMIC ATTRACTION IN DOING SO, SUCH A DEVELOPMENT WOULD PROVOKE A SHARP AND DAMAGING RESPONSE FROM THE P R C. IT IS ALSO LIKELY THAT THE

TAIWAN AUTHORITIES WOULD BE CHARY OF GETTING DIRECTLY INVOLVED IN

WHAT THEY REGARD AS THE POLITICALLY HOT POTATO OF HONG KONG.

BAILES.

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.HONG KONG AGREEMENT

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CONFIDENTIAL