TNAG-2515-FCO40-3669-Future-of-Hong-Kong-International-Rights-and-Obligations-Sub-1992 — Page 4

CONFIDENTIAL

(ii) the prospect of the world's Finance Ministers, Central Bank Governors and top commercial bankers gathering in Hong Kong for the occasion would provide a strong incentive to all concerned to ensure a smooth transition and stability over the period leading up to the establishment of the Hong Kong Special Administrative Region. China, which is supportive of the proposal, has as much interest as Hong Kong in ensuring that the Meetings are held successfully, which would augur well for the new era of Hong Kong under the "one country, two systems";

(iii) this event would be an excellent demonstration of the through-train concept, where the planning work done by the Hong Kong Government would be taken over and implemented by the Hong Kong Special Administrative Region Government; and

(iv) there would be considerable economic benefits in terms of additional tourism and related receipts resulting from the very large number of delegates and visitors coming to Hong Kong for the Annual Meetings.

Possible disbenefits are -

(b)

(i) (a)

although the event would be held in Hong Kong and Hong Kong would play a significant role in the proceedings, the formal host to the Meetings would be China. The precise role of China in the event is not entirely clear at this stage. If China insisted on playing a very high profile role, a wrong impression could be conveyed to the outside world of the extent to which Hong Kong was subordinate to the Mainland. This would adversely affect perception of the financial and economic autonomy of the Hong Kong Special Administrative Region Government;