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Page 5.

by an unwillingness to sppreciate the facts.

13.

The approach to reinst tement propounded by Mr. HO in paragraph 13 follows faithfully the latest communist propaganda line on this subject. No doubt the statement by Governrent issued recently reiterating willingness to con- sider applications from individual strikers for employment will be taken by

Mr. HO as a concession to his views.

14.

Again, in paragraph 14 Mr. HO is the victim of communist propaganda concerning brutal treatment of prisoners by Police. There can, of course, bs no differentiation between communists and non-communists in the processing of

offenders against the law though, no doubt, Mr. HO would dearly like the communists to be favoured in the same manner as now obtains in Macau.

15.

The communists are never satisfied with brief propaganda on their 'victories' (paragraph 15); they repeat and repeat them and this has certainly been the case with the reinstatement of seamen by some shipping companies, despite Mr. HO's protestations to the contrary. It has been demonstrated time and again that any concessions to communists only lead to demands for further such gestures. Mr. 40 somewhat oversimplifies reinstatement; there are other factors such as the threat which will be posed if the communists are permitted to re-establish then- selves in a position of strength in areas vital to the security of the Colony.

16. The statement by 1. HO in paragraph 16 that "the responsible organisa- tion" was criticised by the communist hierarchy for the killing of LAM Bun confiras that an official comunist body, possibly one of the militant unions, planned and

executed this murder.

17.

It is interesting to note th-t HO Yin could be embarrassed by the man- ufacture of bombs by schoolchildren (paragraph 17). From his previous conver- sation it is surprising that he did not put over the communist line that it was the "Hong Kong British" who planted the bomb in the Chung Wah Middle School.

18.

There is little doubt that the C.P.G. maintains a useful record of all

it regards es "anti-China" activities by the Hong Kong Government; it is quite possible that some day they will attempt to use these records to apply further pressure to Government when they feel it will be to their benefit so to do. How- ever, if Ir. HO was making a veiled threst in paragraph 18 it was a rather clumsy

one.

19.

Paragraph 18 is rather self-pitying and paragraph 20, while stating there is room for rance ivre, obviously expects all the manoeuvring to be by the

Hong Kong Government; there is no suggestion that the communists should give

anything.

20.

It is considered that Mr. HO is probably speaking the truth then he

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