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FINANCIAL AND ECONOMIC CONTINGENCY PLANNING
ANNEX
United Kingdon assots in Hong Kong
The book value of direct United Kingdom investments in Hong Kong
(oxcluding oil, insuranco and banking) at ond 1964 was £26 million.
Including investment in insurance and banking and ovor the three years
1963-65 takon together tho now United Kingdom investment totallod
£7.1 million.
Bamings from direct investments for the same three years
totalled £15.8 million. As woll as direct investmont there is probably a
significant portfolio investment.
2.
In so far as those investments are reprosonted by fixed physical
assets such as buildings (and/or by goodwill) there is clearly no prospect
of doing any thing to salvago thom in the ovont of forced evacuation.
(At a later stago the question might arise who thor in a different political
and onotional climate there might be a possibility of gotting compensation
for them under some doal involving trade or financial concessions to China).
3. We have not got considered the question of salvaging movable assots
liko ships (particularly important), commercial stocks of goods, and
such items as precious stones and procious metals (including bullion);
further study of the problems of ovacuating porsons, if this is directod
by Ministers, could bo oxtonded to covor the evacuation of movable assots.
Hong Kong storling holdings in the United Kingdom
4. If the Chinoso had occupiod Hong Kong in the circumstancos assumed for
the purpose of this study, it must be expected that they would try to
obtain control over the disposition of assots, whother domostic or
forcign, belonging to residents of Hong Kong who are unable to escapo
(which would includo banks) and to lay clain to the balances of the
Hong Kong Government.
This lattor claim would no doubt be the subject of
logal disputation. The not total of privato holdings is somo £130 million,
and of official holdings ovor £200 million.
5.
If they obtained control over the disposition of those balancos tho
Chinoso would probably sock to transfer them to the account of tho
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