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FINANCIAL AND ECONOMIC CONTINGENCY PLANNING
ANNEX
United Kingdom assots in Hong Kong
The book value of direct United Kingdom investments in Hong Kong
(excluding oil, insuranco and banking) at end 1964 was £26 million.
Including investment in insurance and banking and over the throo years
1963-65 takon together tho now United Kingdom investment totallod
£7.1 million.
Earnings from direct investmonts for the samo three years
totalled £15.8 million. As well as direct investment there is probably a
significant portfolio investment.
2. In so far as those investmonts aro represented by fixed physical
assets such as buildings (and/or by goodwill) there is clearly no prospect
of doing anything to salvago thom in the ovont of forced evacuation.
(At a later stago the question might arise whether in a differont political
and emotional climato thoro might bo a possibility of getting compensation
for them undor some deal involving trade or financial concessions to China).
3. Wo have not got considorod the question of salvaging movablo assots
liko ships (particularly important), commercial stocks of goods, and
such items as precious stonos and precious metals (including bullion);
further study of the problems of ovacuating porsons, if this is directed
by Ministors, could be extended to cover the evacuation of novablo assots.
Hong Kong storling holdings in the United Kingdom
4. If the Chinoso had occupied 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 domestic or
foreign, belonging to residents of Hong Kong who are unable to oscape
(which would include banks) and to lay claim to the balances of tho
Hong Kong Government.
This lattor claim would no doubt be the subject of
logal disputation. Tho not total of privato holdings is somo £130 million,
and of official holdings over £200 million.
5. If they obtained control over tho disposition of those balancos the
Chinese would probably sook to transfer them to the account of the
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