TNAG-2189-FCO40-3126-Hong-Kong-nationality-package-1990 — Page 155

The Rt hon Sir Patrick Mayhew QC MP

28 December 1989

Thank you for sending me

for sending me a copy of your letter catec 16 December to the Prime Minister.

I was sorry to read of the view you take on the Government's proposal to offer citizenship to up to 225,000 residents of Hong Kong. The purpose of the Government's proposals is this. The United Kingdom has a responsibility for the administration of Hong Kong that will continue until 1997, the date for the termination of the lease. It is comition ground that those portions of the Colony of liong Kong which

included in the lease would be totally incapable of separate existence, and accordingly the Government, in 1984, concluded the agreement with the People's Republic of China. This provided that the United Kingdom would continue to administer Hong Kong up to 1937 in such a way as to foster the economic strength and prosperity of Hong Kong, and that thereafter, for a minimum period of 50 years, Hong Kong would continue to enjoy its present system of law, separate from that of the PKC, and would be administered as one of the semi-autonomous regions of Chine.

It is of critical importance to the future of Hong Kong that conficence should be maintained among those who contribute to its economic strength. At present there is a very damaging out-flow of such people to other countries. if this continued, an enormous purcen would fall upon the United Kingdom for the sustenance of Hong Kong up until 1997. All the advice from Hong Kong 16 to the effect that an offer of citizenship of the nature and on the scale reflected in the Government's proposal will provide the assurance necessary to halt this out-flow. It is neither the intention nor the expectation that more than a small proportion of these people will take up the rights of citizenship and live here: they are much keener on living in Hong Kong and continuing to make money there, something of which the Chinese government itself will need, but they do need this insurance policy.