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IS DOCUMENT IS THE PROPERTY OF

RITANNIC MAJESTY'S GOVERNMENT )

CMV(67)5

Date 8th June 1967

COPY NO

SPARE.

VISITS OF COMMONWEALTH MINISTERS TO DISCUSS FAR EAST

DEFENCE, JUNE 1967

Hong Kong

The Prime Minister has indicated that he would prefer to express

his appreciation personally to Mr. Holt for the action taken by the

Australians in recent wheat negotiations with China in support of our

position in Hong Kong (Commonwealth Office telegram No.1149 to Canberra).

This would be a suitable starting point for any discussion on Hong Kong,

The exchanges with the Australians on this question indicate that they

will in this context ask about our policy on trade with China if the

Chinese continue to make trouble for us in the Colôny.

2.

They will also be interested in our assessm nt of:-

(a) the present situation in the Colony;

(b) future Chinese intentions towards it;

(c) our prospects of maintaining our position

thero.

3.

In the context of the discussions about reductions in our Far

Eastern forces, the Australians are bound to ask about the strength of

the military forces we intend to keep in Hong Kong.

Talking Points

1.

Trade

We are most appreciative of the Australian action in holding

up the conclusion of the agreement to export 2 million tons of wheat to

China, at a time when the disturbances in Hong Kong were at their height.

We did not in any way want to frustrate the deal, but we did think there

would be some advantage in holding up the signature of the agreement

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