CONFIDENTIAL
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(b)
(c)
(a)
(e)
(I)
All publicity which drew attention to Hong Kong's close proximity to a China in convulsion, especially news about the disturbances along the border, created doubts where before people had tended to ignore such dangers.
Unbalanced and sensational reports, as well as even reasonably accurate reports of violent incidents during the disturbances, reinforced assumptions which people had already made about a general lack of safety; a lack of safety both for individual persons within the Colony, and a lack of safety against subversion.
There was some evidence of a lack of confidence locally which, when observod, reported upon, or merely alleged, gave depth to convictions about the insecurity of Hong Kong, e.g...the number of people who made arrangements for themselves or especially their children to leave the colony increased, representing a drain of better educated persons, withdrawl of funds from banks, enquiries about factory sites in Taiwan or Singapore, and the postponement of business ventures and expansion plans.
The disturbances not only focussed world-wide attention on Hong Kong, but also in many instances drow attention to the social conditions of the Colony which, to the more advanced outside world, appeared to them to be conducive to discontent and thus by implication to revolt, e.g. labour conditions, a shortage of opportunities for youth and crowded and squalid housing conditions. Less sympathetic commentators highlighted these con- ditions by contrast with the signs of groat wealth in the colony; other commentators wore not slow to advance allegations of the constitutional anachronism of Hong Kong as a Colony.
Competitor countries in the S.E. asia area, such as Japan, Taiwan, Thailand and the Philippines, though basically concerned that Hong Kong should not disappear as a buffer between them and China, were not slow to take any advantage they could from the withdrawl of buyers, investors or tourists from Hong Kong. They later realised that, as far as tourists are concerned, their prospects were inter- linked with those of Hong Kong.
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CONFIDENTIAL