TNAG-2791-FCO40-4030-Relations-between-Hong-Kong-and-China.-With-maps-1993 — Page 10

CONFIDENTIAL

037447 MDHIAN 7930

MORE CONSTRUCTIVE ATTITUDE, AT LEAST ON PURELY ECONOMIC HONG KONG ISSUES SUCH AS THE AIRPORT. THAT WOULD PROVIDE A NEW BOOST FOR INVESTOR CONFIDENCE HERE, AND THE HANG SENG INDEX. BUT IF CHINESE LEADERS FAIL TO REGAIN THE ECONOMIC INITIATIVE, PESSIMISM COULD SET IN QUICKLY IN HONG KONG. CHINA'S (MEDIA INFLATED) INTERNATIONAL IMAGE AS THE NEXT ECONOMIC SUPERPOWER WOULD SUFFER. THE CUT WHICH HONG KONG TAKES ON SO MANY INTERNATIONAL BUSINESS DEALINGS WITH CHINA WOULD DIMINISH ACCORDINGLY. EVEN SO, HONG KONG HAS ALWAYS RECOVERED REMARKABLY QUICKLY FROM CHINA-INDUCED ECONOMIC SHOCKS, FROM THE FIFTIES ONWARDS. EVEN ON THE MOST GLOOMY PROJECTIONS (AND POLITICAL CALAMITIES ASIDE) NO-ONE HERE BELIEVES THAT LONGER TERM CONSEQUENCES WILL BE ANY MORE SERIOUS THIS TIME.

PATTEN

YYYY

ΜΑΙΝ

25

DISTRIBUTION

36

.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

11

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 LATTER

HMT//PS/CHANCELLOR

HMT//MR MORTIMER

HMT//MR S WOOD

HMT//MS H ROBERTS

NNNN

3

PAGE CONFIDENTIAL