Identifier
Created
Classification
Origin
05HONGKONG4611
2005-10-03 09:06:00
CONFIDENTIAL
Consulate Hong Kong
Cable title:  

HONG KONG CHIEF EXECUTIVE DONALD TSANG LOOKS AHEAD

Tags:  PREL PGOV PINR CH HK 
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O 030906Z OCT 05
FM AMCONSUL HONG KONG
TO SECSTATE WASHDC IMMEDIATE 2818
INFO AMEMBASSY BEIJING PRIORITY 
AMCONSUL CHENGDU PRIORITY 
AMCONSUL GUANGZHOU PRIORITY 
AMCONSUL SHANGHAI PRIORITY 
AMCONSUL SHENYANG PRIORITY 
AIT TAIPEI PRIORITY 3316
NSC WASHDC PRIORITY
C O N F I D E N T I A L HONG KONG 004611 


DEPARTMENT FOR EAP, EAP/CM
NSC FOR GREEN/WILDER

E.O. 12958: DECL: 10/03/2030
TAGS: PREL PGOV PINR CH HK
SUBJECT: HONG KONG CHIEF EXECUTIVE DONALD TSANG LOOKS AHEAD

Classified By: CONSUL GENERAL JAMES CUNNINGHAM. REASONS: 1.4 (B,D).

C O N F I D E N T I A L HONG KONG 004611


DEPARTMENT FOR EAP, EAP/CM
NSC FOR GREEN/WILDER

E.O. 12958: DECL: 10/03/2030
TAGS: PREL PGOV PINR CH HK
SUBJECT: HONG KONG CHIEF EXECUTIVE DONALD TSANG LOOKS AHEAD

Classified By: CONSUL GENERAL JAMES CUNNINGHAM. REASONS: 1.4 (B,D).


1. (C) At lunch with me on October 3, Chief Executive (CE)
Donald Tsang looked ahead to the Government's Policy Address
on October 12, its upcoming proposals for political reform,
and his visit to the U.S. at the end of October. With the
policy and political reform issues out in the open, he hopes
to discuss with the president and the secretary the
importance of Hong Kong's role, both in this region and with
respect to the international community's interaction with
China, and Hong Kong's need for U.S. support.


2. (C) Tsang is tired, and says he hasn,t had a day off in
more than a year. His doctor has told him he needs to find
more time to relax and to exercise. But he is clearly
enjoying the political fray. He and his team have skillfully
controlled the unfolding political debate over the past
months. The popularity of his government is acknowledged
both by the general public and by Beijing. As one of the
major newspapers here put it several weeks ago, in many
respects the political forces are dancing to Tsang,s tune,
and he is proud of his Government's success.


3. (C) He told me that his basic charge from Beijing is to
show that his team can run Hong Kong as efficiently as did
the British, and to solve problems before Beijing becomes
involved. He credited Vice President Zeng Qinghong with
giving strong support, adding that Zeng is very well informed
about Hong Kong developments, down to the details. He added
that President Hu and Premier Wen Jiabao are also
knowledgeable about Hong Kong affairs, and that Beijing has
been "supportive" when he asked. (Comment: the Zeng visit to
Hong Kong, and the invitation to all Legislative Council
members to visit the mainland, were key elements in the Tsang
strategy for improving the prospects for acceptance of the
Government's political reform package. End comment.)


4. (C) Tsang confirmed that the political reform package will
be unveiled after the Policy Address. In the Policy Address,
Tsang will raise many of the social and governance issues
vital for Hong Kong's future. He will seek to broaden
political debate beyond focus on universal suffrage, for

which, he repeated, Hong Kong's immature political structure
is not well prepared.


5. (C) I commended him on his skillful handling of the
gradual emergence of the elements of the Government's
political reform proposal. His opponents across the
political spectrum are obviously feeling that they are being
backed into the corner of having to accept elements they
don,t like. He said that Chief Secretary Raphael Hui, his
right hand, is the master of that process. When I suggested
that dropping the inclusion of appointed District Council
members would ensure its acceptance, he agreed but said
flatly there is no more flexibility from Beijing. He said
Beijing has, from its point of view, been quite forthcoming
by agreeing to inclusion of the directly elected district
representatives in both the Legislative Council and Election
Committee. Exclusion of the appointed reps would "kill the
deal."


6. (C) The proposal will be "take it or leave it." He is
committed, he said, to get the best result possible to
advance democracy, and "no one could do any better." He
personally could support direct elections in 2007/2008. But
that would have created huge problems which aren't even being
discussed, such as Hong Kong's extremely narrow tax base.
(Comment: only 1.5 percent of the population account for 60
percent of all salary tax revenue, and only 18 percent of the
population pay any tax on salary. End comment.) This is an
unstable basis for democracy, he argued. The great fear in
Hong Kong is not taxation without representation, but
"representation without taxation" in which the non-taxpaying
majority would dictate to the taxpayers. He concluded that a
proposal which is disliked by both the democrats and the
pro-business, pro-Beijing elements probably strikes the right
balance.


7. (C) Tsang hopes he can use his visit to the U.S. at the
end of October to discuss with the President and the
Secretary the unique and vital role Hong Kong has to play in
this region's future, and with China itself. He is committed
to the preservation of Hong Kong's distinct character,
without which "we might as well be in Shanghai." Continued
U.S. support will be crucial, he said. In a speech to the
Washington Asia Society he will tackle "head on" the issue of
democracy, and in New York he will meet with the business
community and "The New York Times." He would be willing to
meet with anyone we suggest on the Hill.


8. (C) I told him that in some respects Hong Kong is a
barometer of China,s intentions toward the international
community and its ability to abide by its commitments. Thus,
how Hong Kong acts, and how China acts toward Hong Kong, are
important political and economic indicators. If things start
to go wrong in that dynamic, the reaction will be quick and
negative. He agreed, adding that Hong Kong ways and
standards must be preserved, or it will wither. Hong Kong's
success, on the other hand, has much to offer the
international community, and the rest of China as well.

CUNNINGHAM