BRITISH Foreign Secretary Douglas Hurd will try to persuade his Chinese counterpart Qian Qichen to be more relaxed about sovereignty when they meet in New York next Tuesday. Frustrated by the dismal outcome of the recent Joint Liaison Group (JLG) meeting, the British side is pessimistic there will be any dramatic progress if Beijing remains tough on matters it deems China's sovereign interests. 'If there are no dramatic changes this year, it's certain that JLG business cannot be completed before 1997,' a source close to the JLG said. The two governments are still locked in dispute over matters claimed by China as its prerogative. These include changes to the law, air services agreements and the territory's Budget. A list of 18 items were discussed at last week's JLG plenum. But only one agreement was endorsed by China - investment protection with New Zealand, which an official said was 'not even a major trading partner'. Chinese negotiators blasted the British for ignoring their demand for talks on reclamation of the harbour and the Government move to amend the statute book before 1997. The two sides admitted they were poles apart on whether files of civil servants should be given to the central Government in Beijing or the first chief executive. China argued that it was a matter of sovereignty for all files be passed to Beijing. A senior government official said: 'The constant insistence on sovereignty is in danger of suffocating autonomy.'