CYPHER/CAT A

CONFIDENTIAL

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IMMEDIATE

COMMONWEALTH OFFICE TO HONG KONG

TELNO 270

14 FEBRUARY 1968 (HWB 13/29)

CONFIDENTIAL.

ADDRESSED TO HONG KONG TELEGRAM NO 270 OF 14 FEBRUARY REPEATED

FOR INFORMATION TO PEKING.

YOUR TELEGRAM NO. 135.

WE AGREE THAT THE ANNUAL REPORT ON THE COLONY'S

AFFAIRS WHICH YOU ARE REQUIRED UNDER COLONIAL REGULATIONS TO MAKE TO THE SECRETARY OF STATE (AND WHICH IS PLACED IN THE LIBRARY OF THE HOUSE OF COMMONS FOR THE INFORMATION OF MEMBERS OF PARLIAMENT) COULD NOT POSSIBLY OMIT A FACTUAL ACCOUNT OF LAST YEAR'S TROUBLES. OMISSION OF ANY SUCH ACCOUNT WOULD BE INTERPRETED IN HONG KONG AS AN INDICATION OF THE GOVERNMENT'S WEAKNESS. ON THE OTHER HAND WE SYMPATHISE WITH THE VIEW THAT THE IMPROVEMENT IN HONG KONG AND THE POSSIBILITY OF A SLIGHT IMPROVEMENT IN SINO-BRITISH RELATIONS GENERALLY OUGHT NOT TO BE PUT IN UNNECESSARY JEOPARDY BY WHAT APPEARS IN THE ANNUAL REPORT. IN THIS CONNEXION THEREFORE WE HAVE CAREFULLY CONSIDERED THE POINTS MADE BY HOPSON IN PEKING TELEGRAM

NO. 177.

WE DO NOT THINK HOWEVER, THAT THE TEXT IN ITSELF (PARTICULARLY AS AMENDED IN YOUR TELEGRAM UNDER REFERENCE) CARRIES THE RISK OF SERIOUS DAMAGE TO SINO-BRITISH RELATIONS. THE CHINESE HAVE ALREADY MADE A MAJOR SHIFT IN POLICY BY RENOUNCING VIOLENCE AND VIRTUALLY ADMITTING THAT LAST YEAR'S CAMPAIGN WAS A FAILURE. WE THINK IT UNLIKELY THAT THE REPETITION OF WIDELY KNOWN HISTORICAL' FACTS WILL BRING ABOUT A RADICAL REASSESSMENT OF THEIR POLICY. NOT DO WE THINK THAT THE REPORT BY ITSELF WILL CREATE A NEW OBSTACLE TO THE IMPROVEMENT OF SINO-BRITISH RELATIONS IN THE WAY THAT A SERIOUS INCIDENT IN HONG KONG ALMOST CERTAINLY WOULD. YOU YOURSELF HAVE NO DOUBT ASSESSED THE EFFECT OF YOUR PRESENT TEXT ON

THE LOCAL COMMUNISTS.

2. WE THEREFORE AGREE THAT THE REPORT SHOULD BE PUBLISHED WITH

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