PERSONAL AND CONFIDENTIAL
First Chief Executive and Principal Officials
We set out the advantages in terms of continuity of resuming the pre-Tiananmen discussions with the Chinese on selection of the first Chief Executive, and of carrying forward the discussions launched during the visit of Chen Ziying and Lu Ping to Hong Kong over recent months on Principal Officials. The Secretary of State accepted the need for this. So far as the Chief Executive was concerned, he thought that it would be in our interests to try discreetly to agree with the Chinese in advance the identity of the Chief Executive and to arrange that he should spend some time as Chief Executive-designate working alongside the administration on the model of a President-elect in the US. He thought that the right time to resume the discussions broken off in 1989 would be towards the end of this year. Principal Officials, he also accepted that it was right to resume discreet discussions with the Chinese in due course. Given the sensitivities in Hong Kong, it would be better if this was done as far as possible between the Governor and Chinese representatives in Hong Kong rather than involving London and Peking. He accepted that this issue should not be played too long, given the signs that the Chinese were developing their own thinking about the transition. He agreed to put down a marker about Transitional Affairs' Advisers with Qian in March.
The Economy
On
Discussion centred on the airport. The idea of a "political critical path analysis" flowed from the Secretary of State's wish to make the best use of the Qian visit in terms of anticipating likely Chinese worries and dealing with them before they delayed progress on the airport. He also commented that problems such as contingent liabilities and cost increases were more likely to be understood by those on the Chinese side with experience of business (and for that matter by Li Peng) than by Chinese bureaucrats. He thought that we should be using Hong Kong businessmen to get the message over in Peking. A message from the Prime Minister to Li Peng might also be useful depending on the reactions we got in the Airport Committee and during Qian's visit here.
/Chinese Foreign Minister's Visic
MATAAS
PERSONAL AND CONFIDENTIAL
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