DENG Xiaoping threatened China could seize Hong Kong in a day, former British prime minister Lady Thatcher has revealed. The threat by the Chinese patriarch was contained in his famous warning that Beijing might take back the territory before 1997 at their September 1982 meeting in the Great Hall of the People, Lady Thatcher says in her memoirs, The Downing Street Years, to be published tomorrow. The threat is being used to try to block Governor Chris Patten's moves towards greater democracy in Hong Kong. ''He said that the Chinese could walk in and take Hong Kong back later today if they wanted to,'' says Lady Thatcher. ''I retorted that they could indeed do so; I could not stop them. But this would bring about Hong Kong's collapse. The world would then see what followed a change from British to Chinese rule.'' The memoirs - already the subject of controversy in Britain due to her harsh attacks on former cabinet ministers - also reveal the former prime minister wanted to bring Hong Kong to self-government, considered introducing regular referendums and made a previously undisclosed attempt to persuade Beijing to allow more democracy in 1984. She admits, for the first time, feeling ''depressed'' after agreeing to abandon all administrative links between Britain and Hong Kong after 1997. However, Lady Thatcher predicts economic change on the mainland will lead to political reform: ''The Chinese belief that the benefits of a liberal economic system can be had without a liberal political system seems to me false in the long term.'' Lady Thatcher's description of her meeting with Mr Deng differs from a recently released Chinese account, which quotes the patriarch as only making the more indirect threat that Beijing would ''reconsider the timing and manner of the takeover'' in the event of serious disturbances before 1997. The meeting was widely seen as a failure, but did lead to the opening of negotiations on Hong Kong's future, which eventually led to the signing of the Joint Declaration. The former prime minister says Mr Deng was taken aback by her blunt warning of the consequences of an early takeover. ''His mood became more accommodating. But he had still not grasped the essential point, going on to insist that the British should stop money from leaving Hong Kong . . . It was becoming very clear to me that the Chinese had little understanding of the legal and political conditions for capitalism,'' she says. Lady Thatcher reveals that, with talks deadlocked four months after her meeting with Mr Deng, she privately advocated self-government for the territory. ''I proposed that in the absence of progress in the talks we should now develop the democratic structure in Hong Kong as though it were our aim to achieve independence or self-government within a short period,'' she says. ''We might also consider using referenda as an accepted institution there.'' She later abandoned the idea, after it failed to win the support of ministers and officials, and reluctantly conceded Britain would have ''no link of authority or accountability'' with Hong Kong after 1997. Lady Thatcher reveals she continued to press for more democratic participation during a visit to Beijing to sign the Joint Declaration in December 1984, but received a cool response from the then Chinese premier Zhao Ziyang. But she defends Britain's failure to do more to increase the pace of democracy after the June 1989 Tiananmen crackdown: ''All my instincts told me that this was the wrong time. The Chinese leadership was feeling acutely nervous. Such a step at that moment could have provoked a strong defensive reaction that might have undermined the Hong Kong agreement. We needed to wait for calmer times before moving towards democratisation.''