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defence and internal security is unrealistic in the circumstances
of Hong Kong. The external and internal threats to the Colony
are from the same source. If China wishes to bring pressure to
bear or take over the Colony we can be fairly certain that this
will be done by fomenting and exploiting an internal security
situation.
12. I entirely endorse a view expressed by the Foreign Secretary
in a letter to the Defence Secretary. He wrote: "I do not think
that it is realistic to seek to isolate a uniquely military
role for a services presence which insofar as it is indispensable
for the maintenance of morale and confidence in the Colony is a
buttress for our position in all its aspects.'
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13. We should not therefore rely on any such artificial division
of forces in reaching a decision as to what constitutes a proper
charge on Defence votes. Nor is it reasonable to expect Hong Kong
to contribute on that basis to the cost of the military forces we
consider it necessary to station there, particularly since the
increases now required are very largely a consequence of our
decision to withdraw from Singapore.
14. If it is considered that the dual role of our forces in Hong
Kong should in some way be reflected in Defence votes we might
consider whether, in the special circumstances of Hong Kong, a
proportion of the expenditure could be met from Commonwealth Office
(and eventually Foreign Office) votes. But the usual doctrine (that has stood the test of time) is that a Colony should contribute
to its own defence according to its capacity to pay; and it is on
this basis, I consider, that Hong Kong should continue to contribute.
15.
In cash and in services Hong Kong at present makes an annual
defence contribution of the order of £5 million a year under an
agreement concluded in December 1966 which runs until March 1971.
The contribution will be due for re negotiation in 1970, an
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