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Short-term Policies
43. The Chinese recognise that the events of 1967 showed they
could not achieve dominance except by the use of violence to a
degree which would have gravely impaired Hong Kong's value to them.
This price they were not prepared to pay. Their present policy
-
a
is to expand their commercial interests in the Colony and to
concentrate on building up their support. To this end they are
rebuilding the local communist apparatus and will seek to use this
apparatus to achieve by persuasion, propaganda, intimidation
dominant position in the Colony. A heightening of the level of
propaganda would probably precede another serious attempt to
achieve this dominance. The nature and intensity of propaganda
about Hong Kong, both within the Colony and outside, should
It must be recognised that our ability to bring influence
or pressure to bear upon the Chinese to modify their policies in
our favour is minimal if indeed it exists. Nevertheless, we
provide China with certain services and facilities in the fields
of commerce, shipping, banking and insurance which we could,
if necessary, interrupt. Action on these lines would probably
do no
more than inconvenience the Chinese and in any case we
are inhibited from it by the adverse effect it would have on
Hong Kong's economy. However at a moment of renewed tension,
for example if the Chinese mounted another confrontation, we
might wish to consider such action in order to cause the Chinese
to reflect on their true interests and to bring home to them
the measure of our determination to maintain our position.
We should keep under interdepartmental review what means we
have (if any) of exercising effective economic pressure upon
China.