TNAG-2243-FCO40-3224-Most-favoured-nation-status-for-China-impact-on-Hong-Kong-1991 — Page 121

29:

assification CONFIDENTIAL

OUT TELEGRAM (CONT)

Daveat

Precedence IMMEDIATE

These considerations have been reflected in our discussions with the Chinese over the airport. It is important that the Hong Kong Government has the ability to manage the project efficiently. The Chinese Government have concerns about the effect of the project on the financial position of Hong Kong after 1997: we have made proposals which should meet these concerns. Our negotiators are currently in Peking for talks on

those matters.

I hope that in private contacts with the Chinese authorities your Government will take the opportunity to emphasise to them that the international community attach great importance to the success of the Joint Declaration and to the maintenance of Hong Kong's long-term prosperity and stability: and that investor confidence in Hong Kong will be enhanced if Britain and China can cooperate effectively to manage the transition to Chinese

sovereignty.

Hong Kong will be seriously affected if the United States does

ot renew China's Most Favoured Nation status. We have therefore

lobbied the US Administration in support of renewal of that

status because of Hong Kong.

I hope that the Australian Government will lend its support to

these efforts, in the interests of Hong Kong's continuing

prosperity.

MESSAGE ENDS

2. A signed original will not be sent.

HURD

YYYY

For patrout on orcer see Page

MSC 1 31 Do FC03276 V100 CON 58294

Catchword:

STOCK No. C037C YF67