0003160 G.F. 316

SECRET

-12-

20.

During this period there were indications of dissension

in the ranks of the communists, the more rabid lower strata of the

unions advocating direct and violent action against the Government

and Police, including physical violence, while the communist

intellectuals

and those employed in the economic sphere advocated

a long ideological struggle which would not ruin the economy of the

Colony and thus vitiate the long term objective of control on the

Macau pattern.

21.

There were still no indications that the Chinese People's Government (C.P.G.) were giving the local communists anything more than moral support. The local communist leaders were preparing for a long drawn out struggle if they could not achieve their aim in a

short term. They had come to realise that Hong Kong was a very

different kettle of fish from Macau, and they started to prepare

and make plans for continuing the struggle without assistance from

Mainland China. Reports were received that they were stock-piling

food and preparing weapons, though it now seems' that their aim in

this was not, as was first thought, an all out physical attack

upon Government, but merely to take defensive measures against

possible Government actions.

22.

Other events on the labour front which deserve brief

mention are as follows:

(a) At the Nan Fung Textiles Limited (LIC Internal

Intelligence Report for April 1967, paragraph 6 refers) agitation, fomented by the left-wing

Spinning, Weaving and Dyeing Trade Workers' General

Union (S.W.D.T.W.G.U.) (claimed membership: 5,765;

paid up membership: 3,623) continued throughout the

first half of the month.

(b) Despite the fact that one of the pretexts for the

present confrontation was the "lock out" of workers

in the Hong Kong Artificial Flower Works, (the

original cause of confrontation, see paragraph 3

SECRET

/above)

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