TNAG-2679-FCO40-3876-British-Trade-Commission--Hong-Kong--and-China-Trade-Unit-re-1993 — Page 38

RESTRICTED

FM BTC HONG KONG

TO PRIORITY FCO

TELNO 241

OF 10043OZ SEPTEMBER 93

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PA BTC

37

037546

MDLIAN 6333

HKA 120/1

OPY

16 SEP 1993

Whikey Mh Bates

INFO PRIORITY CANBERRA

INFO ROUTINE DTI, PEKING, HONG KONG, UKREP JLG HONG KONG,

INFO ROUTINE ATTC TAIPEI, TOKYO, SEOUL, SINGAPORE, KUALA LUMPUR INFO ROUTINE JAKARTA, BANGKOK, MANILA, WASHINGTON, WELLINGTON, INFO ROUTINE BONN, EC POSTS

PART ONE OF TWO PARTS:

DTI:

HONG KONG:

CANBERRA:

FOR PEP AND XAAA2D.

STRICTLY PERSONAL FOR POLITICAL ADVISER.

FOR PS MRS BOTTOMLEY.

HONG KONG BUSINESS PROSPECTS: VIEW FROM THE BRITISH TRADE COMMISSION.

SUMMARY.

1.

VALEDICTORY THOUGHTS ON RELINQUISHING THE BTC. HONG KONG'S DISTINCTION FROM CHINA PRINCIPALLY LIES IN THE RULE OF LAW. BUSINESS COMMUNITY, WITH FEW EXCEPTIONS, RELUCTANT TO RECOGNISE THIS. IF THE CONSTITUTIONAL TALKS BREAK DOWN, BUSINESSMEN WILL AGAIN SQUEAL. UK FIRMS COULD SUFFER, E.G. OVER THE CANTON METRO. IF THE CHINESE LIFT THEIR VETO ON AIRPORT AND PORT PROJECTS, LOCAL SENTIMENT WILL BOUNCE BACK. HONG KONG'S ECONOMY A MIXED PICTURE AT PRESENT, BUT MAJOR PROJECTS IN SEVERAL INFRASTRUCTURE SECTORS INDICATE OVERALL CONFIDENCE. HONG KONG AN OUTSTANDING EXPORT PROSPECT, TOGETHER WITH CHINA TRADE VIA HONG KONG.

DETAIL.

2.

I WAS ASKED BY THE DEPARTMENT TO HOLD THE FORT AT THE BRITISH TRADE COMMISSION FOR THREE MONTHS FOLLOWING THE PREMATURE DEPARTURE OF MR.DAY AND PENDING THE ARRIVAL OF MR.CORNISH. THE THREE MONTHS ARE UP. TIME FOR A MOMENT OF REFLECTION ON THE BUSINESS SCENE, PREFACED BY A COMMENT ON THE CHINA/HONG KONG INTER-RELATIONSHIP.

ROLE OF THE RULE OF LAW.

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