CONFIDENTIAL
150000 MDLIAN 627
SUPPORTED. FOR A LEGCO CANDIDATE, SPONSORSHIP BETWEEN HKD300,000 AND 500,000 WOULD BE GIVEN (THE APPROVED ELECTION EXPENDITURE FOR LEGCO IS HKD200,000 FOR EACH CANDIDATE) WHILE THE FUNDING FOR A DB CANDIDATE WOULD BE BETWEEN HKD 30,000 AND 50,000 (THE APPROVED ELECTION EXPENDITURE IS HKD 30,000).
6. AS REGARDS THE POLICY TOWARDS THE CIVIL SERVICE, TO WHICH THE CHINESE ATTACH UTMOST IMPORTANCE, THE NATIONALITY PACKAGE REMAINS THE BIGGEST HEADACHE TO THEM FOR FEAR OF ''BRITISH PEOPLE RULING
HONG KONG''. IN THE NEXT SEVEN YEARS THE CHINESE WOULD UNDERTAKE EXTENSIVE STUDY AND PICK AND GROOM' PEOPLE TO BE SENIOR CIVIL SERVANTS READY TO TAKE ON THE TASKS OF ADMINISTRATIVE OFFICERS AFTER 1997. ON UNITED FRONT WORK, THE CHINESE WOULD PROVIDE MORE SUPPORT TO ''NEUTRAL GROUPS, STRENGTHEN CONTACTS WITH GRASS- ROOTS, AND REINSTATE XU JIATUN'S POLICY OF CULTIVATING THE UPPER ECHELONS OF HONG KONG SOCIETY.
ECONOMIC PLANNING
7. THE CHINESE SIDE HAVE DRAWN UP MEASURE TO PREPARE FOR CHANGES
IN THE ECONOMIC SCENE AND THE IMPACT OF POSSIBLE MOVES OF MAJOR BUSINESS GROUPS DURING THE TRANSITION PERIOD. FOR EXAMPLE, IT WOULD BE NECESSARY TO DECIDE WHICH BANK WOULD ISSUE BANK NOTES
SHOULD THE HONG KONG AND SHANGHAI BANK BECOME REGISTERED IN A FOREIGN PLACE.
8. PRC CAPITAL WOULD NOT TAKE UP TOO HIGH A PROPORTION OF
INVESTMENT IN HONG KONG AFTER 1997 IN ORDER TO PROVIDE AMPLE
OPPORTUNITIES FOR LOCAL AND FOREIGN INVESTORS. BUT FOR THE NEW AIRPORT PROJECT, THE CHINESE WOULD AIM TO SECURE A SATISFACTORY SHARE OF THE INTEREST BEFORE PLEDGING THEIR SUPPORT. THEY WOULD
ALSO NEED TO HAVE A FULL UNDERSTANDING OF THE STRUCTURE OF EQUITY
AND THE BACKGROUND OF CAPITAL SOURCES.
LEGAL PLANNING
9. THE ARTICLE GIVES NO INDICATION OF HOW WORK HAS PROGRESSED ON THIS FRONT.
COMMENT
10. THIS ARTICLE IS THE FIRST ACCOUNT OF THE CONCLUSIONS OF KE'S
TEAM WHICH SPENT SEVERAL WEEKS IN HONG KONG BEFORE RETURNING TO
PEKING IN LATE AUGUST. THE POLICY PROPOSALS ATTRIBUTED TO THEM
REFLECT RECENT UTTERANCES OF PRO-CHINA FIGURES SUCH AS DOROTHY LIU, BUT THE REPORT THAT HONG KONG WOULD CONTINUE TO BE REGARDED AS A BASE FOR SUBVERSION IS NEW, SO IS THE EXTENT OF FINANCIAL
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