TNAG-2452-FCO40-3569-Future-of-Hong-Kong-constitutional-development-1992 — Page 23

CONFIDENTIAL

7675

I think they

MDHIAN 3550,

COMMERCIAL ACTIVITIES OF THE FIRM. OTHER INVESTORS AND BRITISH FIRMS WOULD NOT BE AFFECTED.

BRITAIN SHOULD BE HELD RESPONSIBLE FOR DELAYS IN THE PROGRESS OF THE NEW AIRPORT. CHINA HOPED THE NEW AIRPORT WOULD BE COMPLETED IN ACCORDANCE WITH THE MOU, ON THE BASIS OF COST- EFFECTIVENESS AND WITHOUT PUTTING AN EXTRA BURDEN ON THE SAR.

2.

LU PING WAS QUOTED BY THE PRESS AS SAYING BEFORE THE MEETING THAT THE BRITISH SIDE HAD OVERTURNED PREVIOUS AGREEMENTS AND SUCH A MOVE WAS A 'BIG DIPLOMATIC FRAUD AND A TRAP'. WHAT WAS NOT UNDER DISPUTE WAS NOT A QUESTION OF DEMOCRACY. IT WAS RATHER A QUESTION OF WHETHER PAST AGREEMENTS WERE HONOURED. LU FEARED THE CHANCE OF RESUMING DIALOGUE BETWEEN THE TWO SIDES IN THE NEAR FUTURE WAS NOT HIGH.

COMMENT

3. NOT QUITE THE CHRISTMAS PRESENT WE HAD FEARED. LU HAS RULED OUT MANY OF THE MEASURES WHICH EARLIER REPORTS SUGGESTED THAT THE CHINESE WERE CONSIDERING CA SHADOW GOVERNMENT APPROVING CONTRACTS STRADDLING 1997, EXTENSION OF THE ATTACK ON JARDINES TO OTHER BRITISH FIRMS, ABANDONMENT OF THE AIRPORT MOU).

genuinely belily malag.

There

was

an

147.

Then cd.relyTO THE 1990 EXCHANGES ON THE ELECTION COMMITTEE.

Not so

дим

THE POINT ABOUT EARLIER AGREEMENTS APPEARS TO BE A REFERENCE

I ASSUME LU BELIEVES THAT LEGCO WILL AMEND MY PROPOSALS ON THE FUNCTIONAL CONSTITUENCIES AND IS THEREFORE TURNING HIS ATTENTION TO THE ELECTION COMMITTEE.

5. WHY THE SUDDEN MODERATION? I CANNOT BELIEVE LU WOULD HAVE SPOKEN AS HE DID WITHOUT VERY HIGH LEVEL CLEARANCE. WE MAY LEARN MORE IN THE COMING WEEKS. THE CPU PICKED UP A STORY TWO DAYS AGO THAT THERE WAS A DIVISION IN THE STANDING COMMITTEE OF THE POLITBURO, SOME OF WHOM WERE UPSET THAT VARIOUS

INITIATIVES/STATEMENTS PROPOSED BY ZHOU NAN HAD BEEN APPROVED BY LI PENG WITHOUT REFERENCE. I SUPPOSE IT IS ALSO POSSIBLE THAT THE CLINTON FACTOR HAS WEIGHED IN THE BALANCE.

6.

WHATEVER IS HAPPENING WE WILL PLAY IT PIANO OVER CHRISTMAS. WE ARE NOT BEING DRAWN INTO COMMENT ON LU'S REMARKS. WE WILL DEBRIEF THE DAB AS SOON AS THEY RETURN. THEY ARE SEEING QIAN QICHEN TODAY.

PATTEN

2

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