Sir Percy Cradock: Diplomat who played a crucial role in negotiating the handover of Hong Kong to China

Sir Percy Cradock, the former Ambassador to China, played a pivotal role in, the peaceful transfer of Hong Kong to China in 1997. At the time, given China's overwhelming military advantage, Hong Kong's dependence on China for food and water, and Britain's lack of leverage in the negotiations, it was regarded as a diplomatic triumph for Margaret Thatcher. Cradock had managed to persuade the Chinese leadership to guarantee the British colony's capitalist economy, Western legal system and separate political structure for 50 years. But in Cradock's opinion his work was nearly undone with the appointment of Chris Patten, whom Cradock regarded as merely a self-seeking politician, as the final Governor of Hong Kong.

Hong Kong was first occupied by British forces in 1841 following the First Opium War and was formally ceded to Britain under the Treaty of Nanking. In 1860, after China's defeat in the Second Opium War, the Kowloon Peninsula and Stonecutter's Island were ceded to Britain under the Convention of Peking. In 1898, under the terms of the Convention for the Extension of Hong Kong Territory, Britain obtained a 99-year lease of the lands, which became known as the New Territories and which made up 92 per cent of the colony's area.

With the lease due to end in 1997, Cradock, a Mandarin speaker with many years of experience in China and the Far East and a fervent supporter of realpolitik, set about negotiating with the Chinese. He realised that an agreement was vital for the stability of Hong Kong's economy, and it was clear that without the New Territories it could not survive in isolation, so a solution was needed as to how the transfer would take place.

In 1979, Margaret Thatcher became Prime Minister. She had strong ideas about Britain's standing in the world and how it should assert itself more forcefully on the world stage. Cradock, however, managed to persuade her that a peaceful end to British rule in Hong Kong was possible only with a negotiated deal and that the Chinese would only be interested in full sovereignty. The year after Thatcher's visit to China in 1982, Cradock formally started negotiations over Hong Kong, having already done much work behind the scenes. After nearly two years' hard negotiations the Joint Declaration was signed in December 1984, enshrining the principle of "one country, two systems", with provisions for protecting Hong Kong's way of life for 50 years and an agreement to enlarge democracy in the colony.

Cradock's success in delivering to Thatcher a deal allowed her to boast that Britain had obtained more "basic rights and freedoms" for Hong Kong than most people had ever imagined possible. She was delighted, although her instinct had been more aggressive, and she was always sceptical of a deal dependent on Beijing's goodwill. In the mean time, instead of becoming the next Governor of Hong Kong, Cradock had been appointed foreign affairs adviser to Thatcher and was working in No 10.

In 1992, with Patten's appointment, the negotiated deal was imperilled. Upon his arrival, Patten announced proposals to push for greater progress towards democracy before he had agreed it with the Chinese authorities. Although his stance was welcomed by many in Hong Kong, though not the business community, and by much of the British press, Cradock privately warned that China would be infuriated. It was, and pledged to reverse his reforms, forcing Patten to retreat. "We are shooting ourselves famously in the foot in Hong Kong," Cradock said. "We have screwed it up in a big way."

Cradock was attacked by Patten supporters, who claimed that he had "gone native" and was ignoring Beijing's appalling human-rights record. He dismissed this, explaining: "The Communist system has always meant oppression, cruelty. We knew that when we signed the declaration. We never thought Deng Xiaoping was an Asquithian Liberal. We signed that bloody agreement with him because he ruled China and because he could harm Hong Kong or could help it. We were absolutely cold realists about it."

In the end, the situation eased and Cradock predicted that Beijing, realising what a valuable trading and economic asset it had in Hong Kong, would not destroy its way of life or wreck the main details that he had negotiated. The final handover took place on 1 July 1997.

Born on 26 October 1923 into a family of small farmers in Co Durham, Percy Cradock witnessed the hardship of the inter-war years in the mining communities in the North-east which made him an ardent Labour supporter. He excelled at the Alderman Wraith Grammar School in Spennymoor, and joined the RAF but then war broke out. After the war he became the first member of his family to go to university when he went to St John's College, Cambridge where he read English and Law, securing a double starred first and being elected President of the Union; in 1953 he wrote a history of the Union. He stayed on as a tutor of law and was called to the Bar by Middle Temple in 1953, but decided to leave for the Foreign Office in 1954.

After three years in London, Cradock's first postings were to Malaysia (four years) and a year in Hong Kong. In 1962, he saw mainland China when he was posted to Beijing as Chinese Secretary in the office of the chargé d'affaires. He returned in 1966 as political counsellor, becoming chargé d'affaires in 1968 when Sino-British relations were at their nadir. In his second tour, Cradock experienced first-hand the terror and turmoil of the Cultural Revolution though it was nothing compared to what the Chinese populace endured. In the summer of 1967 the British Embassy was burnt to the ground while the staff were beaten and taken to a diplomatic compound, where they were held for several months. This taught him much about the limits on the West's ability to influence China and the deep and complex feelings China had about its own history. Of those experiences he later wrote: "It was like having the French Revolution being performed on the road outside and occasionally being required to join in."

Cradock left Beijing in 1969 and returned to London. He was first head of planning staff at the Foreign Office, then head of the assessments staff in the Cabinet Office. From 1976 to 1978 he was Ambassador to East Germany. While still there in 1977-78 he led the British delegation during the comprehensive test ban talks in Geneva, remaining until his return to Beijing as Ambassador in 1978.

Following Cradock's appointment to Foreign Policy Advisor at No 10, in January 1984, he became Chairman of the Joint Intelligence Committee. He finally left Downing Street in 1992. In 1994 he wrote a memoir, Experiences of China, which warned that Patten's policies would lead to confrontation and "an ugly stand-off". This was followed in 1997 by In Pursuit of British Interests, a discussion of the issues that had arisen during his time at No 10. In 2002 he published Know Your Enemy, which was criticised by some as too simplistic a view of the world, where there is no CIA and no coups and the world only has "the good guys and bad guys", with the Soviet threat to the world met by Western resolution.

Martin Childs

Sir Percy Cradock, British diplomat: born Byers Green, Co Durham 26 October 1923; Prime Minister's Foreign Policy Adviser, 1984–92; CMG 1968, KCMG 1980, GCMG 1983; married 1953 Birthe Marie Dyrlund; died 22 January 2010.