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5. HMG FULLY REALISE THAT DESPITE HONG KONG'S SPECTACULARLY
BOOMING ECONOMY, THE COLONY'S FUTURE TRADING POSITION IS TO A
CONSIDERABLE DEGREE DEPENDENT ON EXTERNAL FACTORS OVER WHICH THE
HONG KONG GOVERNMENT CAN EXERCISE LITTLE CONTROL. HMG HAVE BEEN
DOING AND WILL CONTINUE TO DO THEIR BEST TO MINIMISE THE PRESSURES
WHICH MAY DEVELOP AGAINST THE COLONY'S ECONOMY AS A RESULT OF THESE
FACTORS. IF THESE PRESSURES WERE TO DEVELOP TO SUCH AN EXTENT
THAT HONG KONG'S ECONOMY WERE SERIOUSLY THREATENED, A NEW SITUATION WOULD HAVE BEEN CREATED AND THIS WOULD HAVE TO BE
CONSIDERED BOTH BY THE HONG KONG GOVERNMENT AND BY HMG IN THE
LIGHT OF THE CIRCUMSTANCES AT THE TIME.
6. THE VIEWS OF THE UNOFFICIAL MEMBERS AS EXPRESSED IN PARAGRAPH
13 OF THEIR MEMORANDUM ARE NOTED AND IT IS RECOGNISED THAT THERE
ARE STRONGLY HELD VIEWS ON THIS SUBJECT. HMG APPRECIATE ALSO
THAT HONG KONG'S SITUATION WAS SUCH THAT DEVALUATION RESULTED IN
THE COLONY'S SUSTAINING LOSSES IN 1967.
7. IT IS TRUE THAT WHEN MR. HEATH, AS LEADER OF THE OPPOSITION,
VISITED HONG KONG AND THE FAR EAST DURING JANUARY 1970, HE MENTIONED
THE FIGURE OF £300 MILLION IN RELATION TO BRITAIN'S EARNINGS OF
FOREIGN EXCHANGE FROM MALAYSIA AND SINGAPORE. MR. HEATH WAS SPEAKING
IN THE CONTEXT OF GENERAL DEFENCE POLICY EAST OF SUEZ AND THE FIGURE
OF £300 MILLION DID NOT RELATE TO HONG KONG.
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COPIES TO
IR D J J BRACK TREASURY.
MR AF THORPE FI(AIR) 2 MOD
MR RJ SMITH DOE LAMBETH BRIDGE HOUSE MR PD NATRNE MOD
MR R GEDLING TREASURY
MR E STRETTON DOE LAMBETH BRIDGE HOUSE. MR F H GWYNN ́MOD
SIR L MONSON
SIR S TOMLINSON HR BOTTOMLEY
AR WILFORD
MR D A SCOTT MR ROSE
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