TNAG-2711-FCO40-3917-House-of-Commons-Select-Committee-on-Foreign-Affairs-and-Par-1993 — Page 106

CONFIDENTIAL

HONG KONG

Since last week's Cabinet there has been a further Round of talks. This produced no progress on a first-stage agreement.

It is essential for us on practical and political grounds that such a first-stage deal should cover all the most urgent issues. One of these is the voting method for LegCo. Our proposal on this has had widespread support in Hong Kong. But the Chinese side adamantly refuse to include it in a first-stage package.

The Foreign Secretary and the Governor have agreed that the time for exploring a first-stage agreement has run out. The Governor has therefore announced in Hong Kong today that he will be introducing draft legislation covering the more urgent issues. Where agreement had been reached in the talks, the draft legislation will reflect this.

The Foreign Secretary gave the Chinese Foreign Minister advance notice and emphasised that we were willing to continue the talks on the remaining issues. We proposed a further Round of talks for this in December.

We received a blunt and bleak response from the Chinese Foreign Minister, making plain that if we introduced draft legislation this would lead to a breakdown in the talks.

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Clear that we are in for a bumpy ride. A Will be important to do all we can to prevent the row spreading to other areas, particularly economic.

The Foreign Secretary plans to make a statement in the House on 6 December.

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CONFIDENTIAL

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