CONFIDENTIAL
sources have been explored without result.
3. On financial grounds Hong Kong's case for seeking assistance
is weak. Government reserves at about 280 million are consider-
able (although there will be many heavy calls on these in the
years ahead); Government revenue continues to be buoyant,
throwing up a steady succession of budget surpluses.
The case
for assistance must rest largely on political grounds and on
meeting the strong public feeling in Hong Kong that the UK has
an obligation to share in the cost of maintaining an airport from
which British aviation interests derive substantial benefit and
where the traffic rights are controlled by HMG in those interests.
4. The political casc also rests on the need to counteract the
feeling in Hong Kong that has been growing for some years now that
Britain regards the Colony as a nuisance and an impediment
(sce Brief No. 13A). This requires the occasional gesture which
demonstrates our concern for and confidence in Hong Kong.
Assistance for this project would be a most suitable and appropriate
gesture, particularly since we have such a strong interest of our
om in it. Our failure to contribute to it can be expected to
increase pressure from Hong Kong for a greater say in the control
of traffic rights, Hong Kong's argument being that if it is to
shoulder the burden of financing the airport it must be allowed
to maximise use and revenues. The more aggressive of the
unofficial members can be expected to make much of this latter
point. The less aggressive are likely to avoid it, resting
their case on the nced to show our confidence in the future of
Hong Kong.
CONFIDENTIAL
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