TNAG-2190-FCO40-3127-Hong-Kong-nationality-package-1990 — Page 63

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The Chinese Response

10. A further matter, not covered by the Home Office submission is the likely Chinese reaction. It is clear from their response to the

20 December statement that they are extremely sensitive to the

prospect of the grant of British citizenship to what they regard as a significant sector of the population. Their concerns appear to

be: the allegiance of beneficiaries after 1997 (they perceive the

scheme as an attempt to extend British influence); conflict with the

Chinese nationality law which does not recognise dual nationality, and allows renunciation of Chinese nationality only through residence abroad or special application (the Chinese have made it

clear they would not countenance queues of applicants in Hong Kong);

and the prospect of people they regard as Chinese seeking British

consular protection. They have already taken what they refer to as

"corresponding measures". They have imposed a foreign nationality

restriction on members of LegCo (20% of the total). They have

slightly extended the posts in Government which can only be filled

by Chinese nationals, and have further excluded "holders of right of abode abroad" from all these posts.

11.

Discussions which the Bill Unit had with HKG in this context

focussed on means to maximise flexibility for the recipients (para 4

above). But Ministers will also wish to be aware of how the Chinese

are likely to interpret the scheme. This scheme, as currently designed will probably result in virtually the entire officer class

of the disciplined services, as well as all senior staff in the civil service holding British passports. When this becomes public

knowledge we may expect the Chinese to feel obliged to take further

corresponding measures. Although the Joint Declaration makes clear

that the HKSAR may employ British and other foreign nationals, the

Chinese may argue that our package is such a departure from the

status quo in 1984 that it amounts to a breach of the spirit of the

JD. They may then decide further to amend the Basic Law to extend the prohibition in JD 74 against foreign nationals holding Secretary level posts, to other, lower ranks. A worst case scenario might see them sacking all officers holding British passports in the

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