TNAG-2753-FCO40-3968-Budget-of-Hong-Kong-1993 — Page 3

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035372

MDHIAN 2237

5. I SAID I HOPED ZHAO WAS NOT SUGGESTING THAT THE FINANCIAL SECRETARY SHOULD HAVE CLEARED HIS BUDGET IN ADVANCE WITH THE CHINESE GOVERNMENT? ZHAO DENIED THIS BUT THEN SAID THAT IN ACCORDANCE WITH THE SPIRIT OF MUTUAL TRUST AND COOPERATION WE SHOULD HAVE CONSULTED THE CHINESE SIDE IN ADVANCE. THIS DID NOT MEAN THAT THE CHINESE SIDE WOULD NECESSARILY VETO THE BUDGET BUT THEY SHOULD HAVE BEEN CONSULTED. I REPEATED THAT ANY CHINESE CONCERNS ON SENSITIVE MATTERS SUCH AS THE BUDGET SHOULD BE RAISED THROUGH THE APPROPRIATE CHANNELS. WE DID NOT EXPECT TO READ ABOUT THEM IN THE PEOPLE'S DAILY.

6.

ZHAO REPEATED HIS COMMENT ABOUT CONSULTATION. I SAID THAT HE WAS APPARENTLY UNAWARE THAT THE GOVERNOR HAD IN FACT SENT A MESSAGE TO DIRECTOR LU PING ON A PARTICULAR SENSITIVE PART OF THE BUDGET: HE MIGHT HAVE EXPECTED MORE IN RESPONSE THAN PUBLIC CRITICISM. I HAD NOTHING FURTHER TO SAY ON THIS MATTER. THE EXCHANGE ENDED AT THIS POINT.

MCLAREN

YYYY

ΜΑΙΝ

25

DISTRIBUTION

34

.HK FINANCIAL

.(DIALOGUE)

HKD

PUSD//HD

ECONOMIC ADVISERS//HD

ERD//HD

RAD//MR WYE

PS

PS/MR GOODLAD

PS/PUS

SIR J COLES

MR HUM

FED//HD

ADDITIONAL

9

CAOFF //SIR R BRAITHWAITE CAOFF//MS DL CORNER CAOFF//MR SIBSON

CAOFF//MISS NEVILLE JONES BANK ENG// MR A CROCKETT

BANK ENG//MR C ELSTON

BANK ENG//MR O PAGE

HMT//MR P GRAY HMT//MR JP MCINTYRE

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