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B.H.C. Singapore telegram No.23 to Commonwealth Office.
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at the present time. We had no alternative but to make our economy strong and plan our commitments according to our resources. Although three years was not a very long time Malaysia's relations with her neighbours were at present good and the stability of the area as was better than in most parts of the world. We were in effect only accelerating a decision which had been taken in principle last July.
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3. Razak argued that the difficulty was not simply an acceleration of our withdrawal but also that we would no longer retain forces in the region thereafter. I urged him not to take too pessimistic a view of our general capability until the military details had been worked out. I pointed to the forces we would be retaining in Hong Kong, which ought to have some psychological value.
4. Tan Siew Sin stressed the difference in the nature of our obligation to Malaysia and to Australia, New Zealand and Singapore. In essence this was that Malaya had at our request taken on East Malaysia a thousand miles away and no one would believe that they were capable of defending it themselves.
5. On Hong Kong, Tan said we should not underestimate the intelligence of Peking: after our announcement on the 17th we were likely to suffer the greatest humiliation in our history there. He felt our decision was precipitate and against our own interests. I said we had weighed all factors before taking these difficult decisions and pointed to the economic value of Hong Kong to China. Tan replied that Peking was playing for high stakes and that in this balance sheet the £150 million which Hong Kong was worth to them annually would not weigh significantly.
6. In view of the inconsistencies with what the Tunku had said (telegram No.22) I pressed them on where they saw the external threat to Malaysia. They conceded that they discounted direct external aggression from China at present but stressed that local Communists would be encouraged by the announcement of our withdrawal and that we would be making their task of controlling internal subversion harder. The Communist party in Sarawak was one of the best organized in the world. Moreover with the new decisions the future of Singapore was unpredictable.
7. After some discussion a communique was agreed which has been telegraphed separately. The Malaysians pressed strongly for a phrase implying that the defence agreement with its commitments would continue but we got them to accept "they stressed the importance which they attached to the defence agreement". On the agreement, they are waiting to see what our general capability means in practical terms. They said they wanted substance and not shadow, but they accept that at the very least an agreed re-interpretation will be required.
Commonwealth Office please pass Canberra 3, Wellington 3,
Bangkok 3, Tokyo 2 and Washington 3.
Mr. Holmer.
[Repetition to Tokyo referred for Departmental
decision repeated as requested to other posts]
PRISEC (C.0.)
[Copies sent to No.10 Downing Street]
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