TNAG-2730-FCO40-3936-Future-of-Hong-Kong-constitutional-development-1993 — Page 79

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THE ORIGINAL HAS BEEN RETAINED IN THE DEPARTMENT UNDER

SECTION 3 (4) OF THE PUBLIC RECORDS ACT 1958

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MDHIAN 4272

- IT WILL NOT HOWEVER CONSIDER CONTRACTS AND FRANCHISES. THE

CHINESE HAVE MADE CLEAR THAT THIS WILL REMAIN A TASK FOR THE JLG WHICH WILL TAKE THE FINAL DECISIONS. MINOR CONTRACTS AND FRANCHISES WILL NOT BE FOR DISCUSSION. THIS LAST POINT IS ACTUALLY A STEP FORWARD ON THE PREVIOUS POSITION: THE CHINESE HAD NEVER RULED THAT EXTENSION OUT BEFORE. THEY HAVE ALSO GIVEN THEMSELVES A POSSIBLE LADDER TO CLIMB DOWN ON CT9.

- THE CHINESE HAVE SAID THAT THE STATEMENT DIRECTED AT JARDINES

IS AN ISOLATED INCIDENT WHICH WILL NOT AFFECT OTHERS. THEY HAVE EVEN SAID THAT IT IS DIRECTED AT JARDINE'S POLITICAL STAND AND WILL NOT AFFECT ITS COMMERCIAL AND ECONOMIC ACTIVITIES.

- ON THE AIRPORT, LU PING HAS EMPHASISED THAT THE QUESTION IS HOW

TO BUILD IT IN ACCORDANCE WITH THE MOU. HE DECLINED TO RESPOND

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TO QUESTIONS ON HUANGTIAN AIRPORT IN HIS TVB INTERVIEW.

QIAN QICHEN TENDED TO DISMISS THE IDEA OF AN INTERNATIONAL CONSPIRACY WHEN TALKING TO THE DAB. HE COMMENTED THAT FOREIGN COUNTRIES WOULD BE LESS UNITED THAN THEY HAD BEEN IN OPPOSING THE FORMER SOVIET UNION: THEY WERE RIVALS IN THEIR DESIRE TO ESTABLISH ECONOMIC TIES WITH CHINA.

THE DAB HAVE REPORTED QIAN AS SAYING TO THEM THAT SINO-BRITISH RELATIONS WOULD MOVE TOWARDS A POSITIVE DIRECTION. HE SAID THAT CURRENT PROBLEMS WERE TEMPORARY. LU PING SEPARATELY DESCRIBED THEM AS SHORT-TERM.

- LU PING IS REPORTED TO HAVE SAID TO THE DAB THAT THE CHINESE

GOVERNMENT HAD NO MORE ''BOMBS'' TO DROP. THAT IS A SIGNIFICANT STATEMENT IF TRUE (EG. INSOFAR AS LAND ISSUES, IIS, WATER ETC. ARE CONCERNED).

4. THE CHINESE POSITION ON DISCUSSIONS REMAINS THAT I MUST FIRST WITHDRAW MY CONSTITUTIONAL PROPOSALS. THEY APPEAR TO HAVE SUGGESTED TO THE DAB THAT WE SHOULD PROPOSE A PERIOD OF CONSULTATION WITH THE HONG KONG PEOPLE. AS YOU SAY, THIS IS A CHANGE FROM THEIR EARLIER DISCOURAGEMENT OF ALTERNATIVE

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